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Global stocks were broadly higher Monday, with investors in Asia gearing up for an eventful week.
Among major events, investors will be focused on the start of formal Brexit negotiations and a decision on whether to include China’s domestically-traded A-shares in MSCI’s emerging-market index, which is widely followed.
Financial markets were unshaken by initial reports of a “major incident” in London involving a van being driven into a crowd of people, resulting in one death and several casualties. The pound GBPUSD, +0.2348% was largely flat against the U.S. dollar.
The Nikkei Stock Average NIK, +0.62% closed 0.6% higher, with a softer yen aiding a move back above 20,000 points. Australia’s S&P/ASX 200 XJO, +0.54% ended up 0.5%, Korea’s Kospi SEU, +0.38% added 0.4%, and Hong Kong’s Hang Seng Index HSI, +1.16% gained 1.1%.
“Trailing in the glow of buoyant U.S. markets, Asian bourses [found] moderate gains to start the week,” said Jingyi Pan, a market strategist at IG Group. On Friday, the Dow Jones Industrial DJIA, +0.11% ended up 0.1% at a record, while the S&P 500 SPX, +0.03% also recorded slight gains.
In Japan, economists had expected a modest trade surplus for May. Instead, the country reported its first deficit since January. A finance ministry official noted it wasn’t uncommon for Japan to post a deficit in May because many manufacturers shut down factories during the “Golden Week” holidays, which limits exports.
Still, local stocks shrugged off the report as the exports data in Japan “continue to reinforce the growth story for Japan’s economy,” said Pan.
Japan’s exports jumped 14.9% for May from a year earlier, the biggest rise since January 2015, marking the sixth consecutive month of increases, the government said Monday. Still, the figure came in lower than an 18.2% increase expected by economists polled by The Wall Street Journal.
Shares of Japanese auto-parts maker Takata 7312, -0.74% were ask-only, meaning no shares have traded because sell orders have overwhelmed buys. The company is in the final stages of preparing to file for bankruptcy protection to address mounting liabilities from its rupture-prone air bags. The company’s shares are down 44% this year.
In China, shares started the week higher, helped by still-resilient housing prices and the central bank’s continued liquidity injections. Home prices in China rose 9.7% from a year earlier in May, versus April’s 9.9% gain. Meanwhile, the People’s Bank of China pumped a further 110 billion yuan ($16.2 billion) into money markets to boost liquidity, following Friday’s 250 billion yuan injection. Stock gains were across the board but led by property, consumer goods and defense sectors.
Across the region, technology stocks continued to rebound after logging losses in several sessions last week. The Kospi IT subindex ended 1.6% higher, while Taiwan’s Taiex Technology Index added 0.9%.