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Nikkei Markets

Nikkei Asia300 climbs ahead of US-North Korea summit

Tencent rises 1% in Hong Kong while Samsung advances in Seoul

HONG KONG (Nikkei Markets) -- Asian stocks outside of Japan edged higher on Monday, spurred by gains for index heavyweights, even as markets awaited a summit between the U.S. and North Korea this week.

The Nikkei Asia300 added 0.4% to 1,417.58. Tencent Holdings climbed 1% in Hong Kong, while Samsung Electronics added 0.5% in Seoul. Investors await the outcome of a first-ever meeting between U.S. President Donald Trump and North Korean leader Kim Jong Un this week in Singapore. Markets are hoping the summit will set the stage for the denuclearization of the Korean peninsula.

"Tomorrow's historic summit between Donald Trump and Kim Jong Un in Singapore has raised the (distant) prospect of international sanctions against North Korea being lifted, a move that one day could even pave the way for the country's integration into the global economy," Gareth Leather, senior Asia economist at Capital Economics, wrote in a note.

Markets also await the outcome of policy reviews at the U.S. Federal Reserve and the European Central Bank this week. The U.S. central bank is widely expected to raise interest rates at its meeting that concludes Wednesday, and investors are likely to wait for cues on whether the authority will deliver a total of three or four rate increases this year.

Data released Monday showed Malaysia's industrial production rose 4.6% in April from a year earlier, driven by the manufacturing sector and electricity output. In March, the industrial production index -- a measure of output from mines, power plants and factories -- had risen 3.1% from a year earlier. Oil-and-gas services firm Sapura Energy ended unchanged at 63.5 Malaysian sen in Kuala Lumpur even as it said its unit, together with partners Sarawak Shell and Petronas Carigali have made their ninth gas discovery offshore Sarawak. The stock is up 15.5% in June so far.

Swire Pacific edged 1% lower in Hong Kong after offering to take aircraft maintenance company Hong Kong Aircraft Engineering (HAECO) private at HK$72 per share in cash, a 63.6% premium to HAECO's closing price on Friday. Swire Pacific is HAECO's largest shareholder and also has a controlling stake in Cathay Pacific Airways. HAECO shares jumped 54.8%, while Cathay added 1.6%.

WH Group dropped 5.6% to HK$7.44. Credit Suisse downgraded the pork producer's investment rating to neutral from outperform, based on low meat prices in the U.S. and trade tensions between the U.S. and neighbors Mexico and Canada.

Hon Hai Precision Industry, or Foxconn, fell 1% in Taipei. The contract manufacturer on Sunday said it is investigating a plant in China that makes devices for Amazon after New York-based China Labor Watch criticized working conditions at the factor, Reuters reported.

Sun Pharmaceutical Industries advanced 1.3% in Mumbai, adding to Friday's over 8% jump after a plant in the western Indian state of Gujarat was cleared of regulatory action by the U.S. Food and Drug Administration.

--V. Phani Kumar

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