17-year high for Asian tech­nol­ogy stocks

Ap­ple re­ports bet­ter-than-ex­pected rev­enue and earn­ings per share

The Star Early Edition - - INTERNATIONAL - Marc Jones

ASIAN tech­nol­ogy stocks hit 17-year peaks and Wall Street’s Dow in­dex looked set to break 22 000 points on Wall Street later, as block­buster earn­ings from Ap­ple rip­pled out to com­po­nent mak­ers glob­ally.

Shares in the world’s most valu­able com­pany surged 6 per­cent af­ter hours to a record of more than $159 (R2 102), tak­ing its mar­ket cap­i­tal­i­sa­tion above $830 bil­lion.

That should help carry the Dow through the 22 000 mark when trad­ing re­sumes in New York. E-Mini fu­tures for the Dow were up 0.2 per­cent, though Europe started flat as dis­ap­point­ing re­sults from Société Générale and Com­merzbank weighed on the re­gion’s bank stocks.

Ap­ple re­ported bet­ter-than-ex­pected iPhone sales, rev­enue and earn­ings per share and said its up­com­ing 10th-an­niver­sary phone is on sched­ule.

It helped dis­pel one of the few nag­ging doubts of the cor­po­rate earn­ings sea­son so far – that Ama­zon’s lack­lus­tre re­sults last week might have re­vealed some tired­ness among

$159 Yes­ter­day’s price of an Ap­ple share on Wall Street

the gi­ant US tech and in­ter­net stocks that have been driv­ing the stock mar­ket rally all year.

“It is all about Ap­ple,” said Naeem As­lam, chief mar­ket an­a­lyst at Think Mar­kets. “It topped its fore­cast and pro­duced stel­lar num­bers for its rev­enue and profit.”

Among Asia’s Ap­ple sup­pli­ers, LG Innnotek jumped 10 per­cent and SK Hynix, the world’s sec­ond-big­gest mem­ory chip maker, rose 3.8 per­cent.

Mu­rata Man­u­fac­tur­ing firmed 4.9 per­cent and Taiyo Yu­den 4.4 per­cent, help­ing the Nikkei up 0.47 per­cent.

The MSCI tech in­dex for Asia climbed 0.9 per­cent to ground not trod since early 2000, bring­ing its gains for the year to a heady 40 per­cent.

Those gains bal­anced losses in ba­sic ma­te­ri­als and en­ergy to leave MSCI’s broad­est in­dex of Asia-Pa­cific shares out­side Ja­pan steady near its high­est since late 2007.

There was a note of cau­tion over re­ports that US Pres­i­dent Don­ald Trump was close to a de­ci­sion on how to re­spond to what he con­sid­ers China’s un­fair trade prac­tices.

Tepid US in­fla­tion along with po­lit­i­cal tur­moil in Wash­ing­ton has less­ened the risk of an­other Fed­eral Re­serve rate hike this year, low­er­ing bond yields across the globe.

Im­prov­ing data in other ma­jor economies has also served to push the green­back down nearly 11 per­cent from Jan­uary peaks, ben­e­fit­ing com­modi­ties and emerg­ing mar­kets.

A swathe of man­u­fac­tur­ing sur­veys (PMIs) out on Tues­day un­der­lined how the im­prove­ment in ac­tiv­ity had broad­ened out from the US to Asia and Europe.Alan Ruskin, head of G10 forex at Deutsche, noted the top five PMIs were all north­ern Euro­pean economies and every in­dex in Europe was in ex­pan­sion­ary ter­ri­tory above 50 points.

“That will do noth­ing to hurt ebul­lient global risk ap­petite,” said Ruskin. “This phase of the risk rally is based on growth data, but even more on sub­dued in­fla­tion mea­sures.

“The lat­ter plays to a grad­ual cen­tral bank exit from ex­treme pol­icy ac­com­mo­da­tion that should pro­long the global growth cy­cle.”

MSCI’s gauge of stocks across the globe has scored its long­est monthly win­ning streak in over a decade.

In cur­rency mar­kets, the dol­lar stead­ied above deep lows though thanks mainly to po­si­tion­ing – bears are al­ready so short of the cur­rency that they are wary of sell­ing even more. – Reuters

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