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Nikkei Markets

Asian stocks gain as US midterm election overhang ends

Singtel slides after profit slump while Pegatron climbs after October sales rise

HONG KONG (Nikkei Markets) -- Asian stocks outside of Japan rose on Thursday, tracking solid overnight gains from Wall Street and cheering the end of uncertainty related to the U.S. midterm elections.

The Nikkei Asia300 Index added 0.5% to 1,225.02. Major U.S. equity indexes rise more than 2% overnight after the elections resulted in a split Congress, as many had expected, and as the dollar weakened against major world currencies. While President Donald Trump's Republican party strengthened its lead in the Senate, and lost control of the House of Representatives to the Democratic party, market participants saw the verdict as a positive.

"The removal of the election overhang underpins risk assets. The midterm election result is, on balance, positive for financial markets," DBS strategist Dylan Cheang, wrote in a note. "Heightened political gridlock will weigh on fiscal stimulus in the U.S., which will, in turn, slow down the rise of the dollar and rates."

The Japanese yen, considered to be a safe haven, fell 0.1% to 113.66 against the dollar, reflecting improved market confidence.

Investors are looking ahead to the G20 summit in Argentina later this month, amid hopes U.S. President Donald Trump and his Chinese counterpart Xi Jinping will announce a deal signaling easing of trade tensions between the two nations.

Great Wall Motor climbed 1.3% in Hong Kong after reporting a 1.9% increase in sales volume for October.

Personal-computer and mobile phone maker Lenovo Group edged 0.5% lower after rising as much as 6.3% earlier. The company on Thursday reported a 21% increase in second-quarter profit, helped by lower operating costs and higher revenue.

Samsung Electronics edged 0.1% higher in Seoul. The company on Wednesday unveiled a new phone with a foldable screen. The launch date and price points were not revealed.

Pegatron advanced 1.2% in Taipei. The company, an assembler of Apple products, on Thursday posted an 11.7% increase in October sales from a year ago.

AU Optronics added 1.2% despite reporting a 3.4% decrease in October sales from a year ago.

Singapore Telecommunications fell 1.9% after reporting a 77% plunge in fiscal second-quarter net profit due to the absence of one-off gains as well as weakness in regional currencies such the Australian dollar, the Indian rupee and the Indonesian rupiah.

Developer UOL Group added 0.8% in Singapore after saying it is currently in preliminary talks with a party to acquire an office building in Sydney.

The Nikkei index for Southeast Asian companies rose 0.5%. The country gauge for the Philippines added 0.1% even as data showed the nation's economic growth slowed in the third quarter. Malaysia's index climbed 0.4%. The nation's central bank on Thursday kept the benchmark policy interest rate unchanged at 3.25%, as expected, as it expects growth to remain strong amid lower inflation.

-- Suzannah Benjamin

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