Asian Equities Poised for Record High Amid Technology Rebound

• December 28 2017
• Livia Yap

A gauge of Asian equities headed toward a record close amid a rebound in technology stocks in the penultimate trading session of the year.

A gauge of Asian equities headed toward a record close amid a rebound in technology stocks in the penultimate trading session of the year.

The MSCI Asia Pacific Index climbed 0.4 percent to 173.28 as of 11:40 a.m. in Hong Kong. Major technology names such as Samsung Electronics Co. and Hon Hai Precision Industry Co. boosted the benchmark after a recent selloff in the sector. Largan Precision Co. climbed after it flashed an oversold signal on Wednesday, with its 14-day relative strength index falling to 22.

Technology stocks “have had a substantial correction before this, so you should be looking for a technical rebound anywhere from here,” Hao Hong, chief strategist at Bocom International Holding Co. in Hong Kong said by phone. “Tech is a long-term opportunity, you shouldn’t measure the performance in terms of weeks, months or even years.”

The Asia Pacific benchmark index has risen 28 percent this year. While the information technology subgauge has led the yearly charge, it is still headed for its first monthly loss in a year.

Asian stocks also benefited from a weaker dollar, which raises expectations for inflation to surprise on the upside in the near term, which will benefit earnings, said Bocom’s Hong.

“Emerging Asia tends to do very well in this kind of environment: a weak dollar, reasonable growth and higher-than-expected inflation,” the strategist said.

Summary

• Topix little changed, Nikkei 225 +0.1%
  • Japan Stocks Swing as Banks Decline, Trading Firm Shares Gain
• Hang Seng Index +0.6%, Hang Seng China Enterprises Index +0.4%, Shanghai Composite Index +0.5%, Shenzhen Composite +0.6%
  • Hong Kong Stocks Rise to Highest in Month as Tech Shares Rebound
• Taiex +0.6%
• Kospi +0.7%, Kospi 200 +0.8%
• S&P/ASX 200 +0.1%; New Zealand’s S&P/NZX 50 +0.2%
• Straits Times Index +0.3%, Malaysia’s KLCI +0.4%, Jakarta Composite Index +0.1%, Thailand’s SET Index -0.1%, Philippine Stock Exchange Index +0.5%, Vietnam’s VN-Index +0.3%
• India’s SGX Nifty 50 futures +0.2%