Asia tech stocks bask in Apple glow, dollar in the dark

SYDNEY: Asian technology stocks hit 17-year peaks on Wednesday as blockbuster earnings from Apple rippled out to component makers globally, helping the broader market offset losses in the energy sector.
Shares in the world’s most valuable company surged 6 per cent after-hours to a record of more than $159, 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 per cent, while Eurostoxx 50 futures added 0.1 per cent.
The tech giant reported better-than-expected iPhone sales, revenue and earnings per share and signalled its upcoming 10th-anniversary phone is on schedule.
Among Apple suppliers, LG Innnotek jumped 10 per cent and SK Hynix, the world’s second-biggest memory chip maker, rose 3.8 per cent.
Murata Manufacturing firmed 4.9 per cent and Taiyo Yuden 4.4 per cent, helping the Nikkei up 0.47 per cent.
The MSCI tech index for Asia climbed 0.9 per cent to ground not trod since early 2000, bringing its gains for the year to a heady 40 per cent.
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 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 per cent 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 United States 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.
“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.
On Wall Street, the Dow ended on Tuesday with gains of 0.33 per cent, while the S&P 500 added 0.24 per cent and the Nasdaq rose 0.23 per cent.
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.
The dollar index was stuck at 93.052, after touching 92.777, the lowest since early May 2016. It was aided by gains on a softer yen which saw it creep to 110.80.
Yet the euro also benefited from buying against the yen, reaching its highest since February last year. It edged up 0.2 per cent on the dollar to $1.1827 and back towards the 2-1/2 year high of $1.1845 struck on Monday. — Reuters