Stock market today: Asian shares gain on back of Wall Street rally as war shock to markets fades

By ELAINE KURTENBACH
AP Business Writer

BANGKOK (AP) — Asian shares advanced Tuesday after U.S. stocks rallied as investors unwound some of last week’s moves driven by worries about war in the Middle East.

Oil prices slipped and U.S. futures also edged lower.

Markets are awaiting China’s latest economic growth figures, due Wednesday. Economists are forecasting that annual growth dropped to under 5% in July-September from 6.3% in the previous quarter.

A weaker Chinese economy is a drag on regional and global trade and manufacturing, slowing the global recovery from the pandemic.

Tokyo’s Nikkei 225 was up 1% at 31,988.40 and the Hang Seng in Hong Kong added 0.7% to 17,763.41.

The Shanghai Composite index gained 0.3% to 3,081.75. In Australia, the S&P/ASX 200 climbed 0.5% to 7,059.00. India’s Sensex advanced 0.5% and the SET in Thailand rose 0.5%.

Markets appeared to have recovered, for the moment, even as Israel was preparing for a likely ground offensive into Gaza and fears deepened that the conflict could spread along Israel’s border with Lebanon.

On Monday on Wall Street, the S&P 500 climbed 1.1% for its best day since the Oct. 7 surprise attack on Israel by Hamas. It closed at 4,373.63. The Dow rose 0.9% to 33,984.54 and the Nasdaq composite added 1.2% to 13,567.98.

“The risk-off tone that permeated markets a few days ago seems to be dissipating thanks to a lot of shuttle diplomacy by (U.S. Secretary of State Antony) Blinken and others in the region,” Robert Carnell and Nicholas Mapa of ING Economics said in a commentary. “However, all of this is before Israel mounts its ground offensive in Gaza, and that could turn sentiment rapidly sour again.”

Oil prices have fallen back after a volatile week spurred by worries about disruptions to supplies from Iran because of the war.

Early Tuesday, U.S. benchmark crude oil was down 18 cents at $86.48 per barrel in electronic trading on the New York Mercantile Exchange. On Monday it fell $1.03 to settle at $86.66. It has been bouncing up and down since barreling from $70 during the summer to more than $90 late last month.

Brent crude, the international standard, gave up 3 cents to $89.62 per barrel. It fell $1.24 on Monday to $89.65 per barrel.

Gold fell $6 to settle at $1,928.30 per ounce. Last week was its best in nearly seven months as worries climbed ahead of a possible invasion by Israel of northern Gaza.

Treasury yields have jumped after tumbling last week on worries that fighting in Gaza will escalate. Early Tuesday, the yield on the 10-year Treasury was 4.75%, up from 4.71% on Monday and from 4.62% late Friday.

Financial markets have a history of weakening initially after a geopolitical shock, such as a war, only to reassert themselves and eventually move with corporate profits, economic growth and other long-term fundamentals, according to Mark Hackett, chief of investment research at Nationwide.

“Investors should remember that markets are very resilient, have endured countless wars, recessions, and depressions, and have rewarded long-term investors with a well-crafted financial plan,” he said.

More than 50 companies in the S&P 500 will report their earnings for the summer this week, including Bank of America, Johnson & Johnson and Tesla, and investors are hoping for a better reporting season for corporate profits.

Last week, several banks helped kick off the reporting season with better reports than feared.

Charles Schwab rose 4.7% after it reported stronger profit for the three months through September than analysts expected.

Shares of Lululemon jumped 10.3% in their first trading session after S&P Dow Jones Indices said the apparel company will join its widely tracked S&P 500 index. It’s replacing Activision Blizzard, which was bought by Microsoft.

A remarkably resilient U.S. economy has continued to power along, despite much higher interest rates instituted by the Federal Reserve to undercut inflation. With employers still adding jobs and U.S. households continuing to spend, even if they’ve become more discerning because of high inflation, earnings per share at S&P 500 companies likely rose 0.4% last quarter from a year earlier, according to FactSet.

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AP Business Writer Stan Choe in New York contributed.