By Gregor Stuart Hunter
SINGAPORE, May 21 (Reuters) – Asian stocks surged on Thursday as some vessels resumed passage through the Strait of Hormuz, while forecast-beating results at Nvidia and a suspended workers’ strike at Samsung Electronics lifted shares of chipmakers.
MSCI’s broadest index of Asia-Pacific shares outside Japan climbed 2.6%, snapping a four-day streak of losses. Korea’s KOSPI leapt more than 7%, Taiwanese shares rose 3.5% and Chinese blue-chips gained 1.1%.
Brent crude futures edged up 0.6% to $105.68 a barrel in Asia trade, retracing declines after three supertankers passed through the strait on Wednesday and Iran consolidated its control of the waterway. Supply concerns persist though following a U.S. inventory drawdown.
On Wall Street on Wednesday, the S&P 500 rose 1.1%, while the Nasdaq Composite rallied 1.5% after three days of declines, as President Donald Trump said the United States was ready to proceed with further attacks on Iran if Tehran did not agree to a peace deal, but suggested Washington could wait a few days to “get the right answers.”
“Oil prices declined and other major markets rallied, as investors took comfort from headlines quoting Trump saying the U.S. was in the ‘final stages’ with Iran,” analysts from Westpac wrote in a research report.
Asian chipmakers’ shares rose after Nvidia’s better-than-expected revenue forecast on Wednesday as CEO Jensen Huang aimed to reassure investors that the world’s most valuable company can sustain blockbuster growth in demand for its flagship AI chips.
“The chip landscape remains Nvidia’s world with everybody else paying rent, as more sovereigns and enterprises wait in line for Nvidia’s chips,” said Dan Ives, global head of technology research at Wedbush Securities in New York.
However, Nvidia’s shares fell 1.3% in extended trading, while S&P 500 e-mini futures slipped 0.2%.
“The market’s reaction was relatively muted by its own lofty standards,” said Tony Sycamore, market analyst at IG in Sydney. “The lack of any China sales in the outlook and guidance that was only modestly ahead of expectations left some investors wanting a bit more fireworks.”
In Seoul, Samsung Electronics shares surged 6% after the electronics giant’s union said it would suspend industrial action upon reaching a tentative pay deal with the company, averting a strike by nearly 48,000 workers that threatened South Korea’s economy and global chip supply.
However, the rally was blunted after a shareholder group said the management’s tentative pay deal with its labour union was illegal, adding that it would file for an injunction if it is approved by union members, the Yonhap News Agency reported on Thursday.
Japan’s Nikkei 225 share index jumped 3.6% after S&P Global’s flash manufacturing PMI showed expansion in May, albeit at a slower pace than a month earlier, slipping to 54.5 from 55.1 in April, but still firmly above the mark separating growth from contraction.
“By and large, external demand has turned out exceptionally strong despite the U.S.-Iran conflict,” analysts from DBS wrote in a research report. “This could give BOJ the confidence to hike in June, which should lift the yen if there are no fiscal mishaps.”
Separately, Japanese exports rose 14.8% year-on-year in April, finance ministry data showed, rising for an eighth straight month and confounding fears of stagflation in the global economy. Against the yen, the dollar was flat at 158.84 yen.
Australian shares rose 1.6%, lagging the regional rally after a mixed set of economic indicators.
The Aussie dollar sank 0.7% to $0.7105 after Australian employment unexpectedly fell in April, while the jobless rate jumped to the highest since late 2021, a possible sign the labour market might be loosening enough to stave off a near-term rate hike.
“The strong pick-up in Australia’s jobless rate in April makes it all but certain that the Bank will leave rates on hold at 4.35% at its June meeting,” analysts from Capital Economics wrote in a research report. “However, with underlying inflation set to accelerate further, we’re not convinced the Bank will call time on its tightening cycle.”
Flash PMI data showed activity in the country’s service industry slowed to 47.7 in May from 50.7 a month earlier, though a corresponding manufacturing gauge held at 50.2, just above the mark separating expansion from contraction.
The yield on the U.S. 10-year Treasury bond was up 1 basis point at 4.578%, resuming its climb after snapping a three-day streak of declines on Wednesday. Minutes from the Federal Reserve’s April 28-29 meeting showed policymakers’ concerns about inflation intensified last month, with a growing number open to the possibility that they may need to raise interest rates.
Gold rose 0.4% to $4,561.95 as fears of inflation grew, while bitcoin was 0.2% higher at $77,832.41 and ether nudged up 0.3% to $2,141.15.
(Reporting by Gregor Stuart Hunter; Editing by Jacqueline Wong)
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