Asian stocks gain after Wall Street advances to record

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Asian stock markets rose on Monday after Wall Street turned in its fifth straight weekly gain and China’s manufacturing growth held steady.

Benchmarks in Shanghai, Tokyo, Hong Kong and Seoul advanced.

US stocks benefited from Federal Reserve chairman Jerome Powell’s announcement of a strategy change that could keep interest rates low for a long time. The change, dubbed “average inflation targeting“, could mean rates stay low even if inflation hits the Fed’s 2% target.

The market continues to run hot after US Fed Chair Powell tipped his hat to a lengthy period of easy Fed policy, said Stephen Innes of AxiCorp in a report.

The Shanghai Composite Index rose 1.1% to 3,441.31 after the Chinese statistics bureau and an industry group reported a survey showed manufacturing grew in August at about the same rate as the previous month.

The Nikkei 225 in Tokyo added 1.9% to 23,329.47, rebounding after Prime Minister Shinzo Abe’s announcement that he was resigning for health reasons triggered heavy selling on Friday. Hong Kong’s Hang Seng advanced 1.4% to 25,780.44. The Kospi in Seoul was little-changed at 2,354.11.

Australia’s S&P-ASX 200 was 0.2% higher at 6,083.70. New Zealand and Jakarta retreated while Singapore gained.

Global stock markets have recovered most of this year’s losses despite rising coronavirus infection numbers in the United States, Brazil, and some other countries.

Wall Street’s benchmark S&P 500 index is at a record high, propelled by big gains for technology stocks investors expect to do well despite the pandemic. But most stocks in the index still are down.

On Friday, the S&P 500 gained 0.7% to 3,508.01. The index gained 3.3% for the week, capping its longest weekly winning streak since December.

The Dow Jones Industrial Average rallied 0.6% to 28,653.87. It returned to positive territory for the year.

The Nasdaq composite climbed 0.6% to a record of 11,695.63. Benchmark US crude oil gained 20 cents to 43.17 per barrel in electronic trading on the New York Mercantile Exchange. The contract slipped 7 cents on Friday to settle at 42.97.

Brent crude, the international standard, rose 34 cents to 46.15 per barrel in London.

The dollar declined to 105.46 yen from Friday’s 105.55. The euro edged down to 1.1913 from 1.1918.

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