Korean détente lifts Asian shares

ASIAN shares extended gains on Monday as tensions in the Korean Peninsula eased and earnings shone, although some investors were cautious about the outlook amid the backdrop of a simmering US-China trade dispute.

MSCI’s broadest index of Asia-Pacific shares outside Japan climbed 1pc, adding to a similar rise on Friday. The index is now poised for a modest rise this month after two consecutive losses.

South Korea’s KOSPI index jumped 0.8pc and is set to end April more than 2.5pc higher following record profits from tech giant Samsung Electronics and after a spectacularly successful inter-Korean summit.

In Europe, however, Italian stocks and bond markets came under pressure on Monday, pushing the gap between Italian and German bond yields to its widest in almost two weeks, after Italy’s antiestablishment 5-Star Movement raised the prospect of fresh elections.

In currencies, sterling held near twomonth lows as Britain’s home secretary resigned – adding to the considerable troubles of Prime Minister Theresa May’s government.

The pound was last buying $1.3778, after falling 0.9pc on Friday when disappointing economic growth data challenged expectations the Bank of England would raise rates in May. A couple of weeks ago it had been as high as $1.4377.

Overall, stocks continue to be supported by strong first quarter corporate earnings. More than half of Wall Street’s S&P 500 companies have reported and 79.4pc have beaten consensus estimates.

But investors have grown increasingly jittery with the US Federal Reserve signalling faster rate rises this year and the European Central Bank seen likely to end its bond-buying programme soon.