Asia shares surge on tech mood swing, oil retreats

Asia shares surge on tech mood swing, oil retreats SYDNEY, Aug 5 : Asian stock markets jumped on Wednesday as strong earnings and a resurgence of demand for tech lifted Wall Street to record peaks, while hopes for progress on opening the Strait of Hormuz dragged on oil prices and bond yields. Japan's Nikkei climbed 3.0 per cent and South Korea added 3.4 per cent, continuing its run of wild swings. MSCI's broadest index of Asia-Pacific shares outside Japan rose 1.5 per cent. Not all tech firms benefited equally though. Investors appeared to be taking profits on AMD even as its results beat forecasts. Shares in the chipmaker sank 9 per cent after the bell. AI and satellite group SpaceX shed 7.5 per cent, undoing much of a rally in regular trading time, on worries capex spending was eating up all its cash flow. This has been a recurring concern for all AI stocks given the vast cost of compute power, with borrowing costs for the sector continuing to rise. "SpaceX continues to execute strongly operationally, but its ambitious investment program means additional capital will almost certainly be required over the medium to longer term," said Chris Weston, head of research at broker Pepperstone. "How management funds that growth, and at what cost, is likely to remain a central theme for investors over the coming quarters." Nasdaq futures dipped 0.1 per cent on the earnings results, while S&P 500 futures added 0.2 per cent after hitting all-time highs on Tuesday. EUROSTOXX 50 futures gained 0.3 per cent, while DAX futures rose 0.5 per cent and FTSE futures added 0.1 per cent. OIL SLIDE BOOSTS BONDS Sentiment was supported by an ongoing slide in oil prices as Qatar said mediators were making progress in efforts to end the U.S.-Iran war, though details were lacking. Brent crude eased 0.4 per cent to $79.02 a barrel, a long way from its July top of $102, while U.S. crude dropped 0.5 per cent to $75.35. The pullback in oil provided some relief from inflation fears and boosted bonds globally, with 10-year Treasury yields now at 4.6187 per cent, down from last week's high of 4.747 per cent. Markets also sharply pared the probability of a September rate hike from the Federal Reserve to 57 per cent from 67 per cent. Fed Bank of Kansas City President Jeff Schmid, however, used a speech on Tuesday to call for tighter policy to help bring inflation back to the central bank's 2 per cent target. Currencies were mostly quiet, though the New Zealand dollar slipped 0.2 per cent after data showed unemployment hit a decade peak of 5.6 per cent in the June quarter. The euro was flat at $1.1532, just short of its recent six-week high at $1.1559. The dollar was a shade lower on the yen at 157.53, with the threat of intervention lingering over traders. U.S. Treasury Secretary Scott Bessent said he was sure Bank of Japan Governor Kazuo Ueda will "do what is best" for the country's economy, which markets took as encouragement to raise interest rates further. Japan and the United States launched a rare joint yen-buying intervention last week and vowed to take further action if needed to shore up the currency. In commodity markets, the drop in yields helped non-interest-paying gold edge up 0.1 per cent to $4,080 an ounce. [Image text:] 3715.0 DENA 1516.5 2570.5 zarer A DORT 95540 BE 3ES10 HN ut 42890 1531.5 5959.0 FAW Dr 77560 457800 e 2700.5 6472.0 Fas DEIN 3298.0 1251.0 120 3091.0 29 925.9 7601E 54U 205 a 5 3 0. 1 ron