Asian stocks rise after Macron wins French elections, China lags
Investors pleased, but gains are muted as result of presidential vote priced in
HONG KONG (Nikkei Markets) -- Asian markets edged higher on Monday as risk appetite firmed after pro-European Union candidate Emmanuel Macron comfortably won French presidential elections and energy prices rebounded.
The Nikkei Asia300 index rose 0.3% to 1,195.20. Traders said Monday's gains were muted as the win was likely priced in, with polls ahead of Sunday's vote placing Macron well ahead of his opponent. The 316-stock gauge has risen almost 3% since Macron beat his far-right rival Marine Le Pen in the first round of voting a fortnight ago.
"Investors will likely welcome this result, as it eliminates uncertainty about France's continued membership in the euro," UBS economists wrote in a note. "However, as this result was widely expected, markets had to a large extent positioned for it ahead of the final vote. So, any relief rally may be capped in the short term."
The euro was down 0.2% against the dollar, after rallying more than 2% to a six-month high following the outcome of the initial vote last month.
Japan's 225-issue Nikkei stock average rallied 1.8% as markets opened after the Golden Week holiday. South Korea and Philippine's benchmark indexes added at least 0.6% each. Hong Kong's Hang Seng Index advanced 0.4% and Singapore's Straits Times Index was little changed.
Sentiment in Asia also got a fillip after a better-than-expected U.S. employment report helped lift the benchmark S&P 500 Index to a record high in the previous session. The U.S. benchmark crude oil contract rose 1.5% on Friday after Saudi Arabia's energy minister reportedly said OPEC's production cuts, due to end in June, will likely be extended till the end of 2017.
Mainland Chinese markets, however, extended a four-week losing streak amid ongoing concerns about tighter regulations and tepid economic data. The Shanghai Composite was down 0.9% at near four-month lows, while its Shenzhen counterpart shed 0.8%.
"The recent weak economic data point to slowing growth momentum in China. Also, it is clear that too much speculation or too much liquidity is not wanted by authorities and the tightening of financial regulations is hurting sentiment," said Steven Leung, executive director of institutional sales at UOB Kay Hian.
China's exports last month rose 8% year-on-year in dollar terms, according to official data released Monday, slower than a 16.4% growth in March and below estimates compiled by Reuters. Imports also missed expectations, growing 11.9% in April.
Still, a gauge of mainland companies listed in Hong Kong rose 0.7%, heading for its first advance in six sessions, led by energy producers. China Petroleum and Chemical (Sinopec) added 1.2% in Hong Kong and PetroChina rose 0.6% as Brent crude prices climbed 1.5% in early Asian trading.
Chinese telecom-equipment maker ZTE rose 0.7% in Hong Kong after it said Turkey's competition board has approved its acquisition of a 48.04% stake in Netas Telekomunikasyon.
Chinese automaker SAIC Motor fell 0.4% in Shanghai despite reporting a 6% rise in vehicle sales in April. Geely Automobile Holdings added 2.1% in Hong Kong following a 94% jump in last month's unit sales.
Singapore Exchange dipped 0.3% after its securities markets turnover fell 26% in April.
--Nimesh Vora and V. Phani Kumar
--Nikkei Markets is a real-time financial news service for South East Asia's markets published by Nikkei NewsRise Asia Pte Ltd, a Nikkei and NewsRise joint venture company. Nikkei Markets provides wide companies coverage in the region, including the Nikkei's Asia300 companies.