HONG KONG Asian shares rose on Thursday after Tech wunderkind Nvidia's latest earnings boosted Wall Street and a retreat in U.S. bond yields eased pressure on borrowing costs globally.
A round of soft manufacturing surveys had also revived hopes central banks were tightening, though that might change depending on what hint of interest rates Federal Reserve Chairman Jerome Powell gives at an annual Central Bank summit in Jackson Hole, Wyoming.
Equities rose and bond yields retreated as flash PMI data for August showed weaker economic activity in the U.S. euro area and the UK, fuelling market expectations that central banks may not have to raise rates again, said analysts at ANZ.
This week's Jackson Hole Symposium remains firmly in focus for markets We expect Powell to err on the side of caution with respect to inflation, noting some signs of improvement but still with a long way to go. European markets were set for a higher open, with pan-region Euro Stoxx 50 futures up 1.7 percent, German DAX futures up 0.6 per cent and FTSE futures adding 0.5 per cent.
MSCI's broadest index of Asia-Pacific shares outside Japan surged 1.7 percent, while Nvidia's bullish outlook for Japan was up 1.7 per cent.
The index, however, is down 8.1 per cent so far this month because of a lackluster economy and yuan in China and some gloomy factory readings from Japan, which also left sentiment vulnerable.
U.S. stock futures, the S&P 500 e-minis, rose 0.77 per cent.
Australian shares edged up 0.63 per cent, while Japan's Nikkei stock index rose 0.81 per cent, marking the longest streak of gains since mid-June.
China stocks also rose on Thursday with the blue-chip CSI 300 index advancing 1.28 per cent and Hong Kong's Hang Seng index up 2.1 per cent in afternoon trade as some investors bought the dip following recent slumps.
The dollar climbed higher against the yuan as the central bank continued to fix the daily mid-point at stronger-than-expected levels.
China's currency has surged higher today, with foreign capital flowing back into and helping stabilise China's stock markets, said Zhang Zihua, chief investment officer at Beijing Yunyi Asset Management. After Nvidia's predictions, a rally in the broader Asian markets has also lifted sentiment. The foreign investors bought a net 2.9 billion yuan $398.78 million of Chinese shares yesterday, snapping a 13-day selling streak.
On Wednesday, U.S. stocks ended sharply higher as shares of Nvidia surged nearly 10 per cent after the bell, hitting an all-time high after it forecast third-quarter revenue well above Wall Street targets.
The Dow Jones industrial average surged 0.54 per cent, the S&P 500 rose 1.10 per cent, and the Nasdaq Composite rose 1.59 per cent.
In U.S. Treasuries, the yield on benchmark 10-year Treasury notes rose to 4.2076 per cent compared with its U.S. close of 4.198 per cent on Wednesday after it eased from near 16-year highs after weak business activity data from the United States and the euro zone.
The two-year yield rose with traders' expectations of higher Fed fund rates, compared to a close of 4.952 per cent.
In Asia trade, the dollar index remained flat at 103.35 in afternoon Asia trade after hitting a two-month high of 103.4 against a basket of major currencies.
The yen was up 145.165 after reaching a nine-month trough of 145.34 a week ago, according to talk from a former Bank of Japan official that Japan will only intervene in the market if the currency plunges past 150 to the dollar.
The dollar dropped to $78.84 a barrel on the Nasdaq stock market. The price of Brent crude dropped to $83.2 per barrel on the Nasdaq Stock Market.
Gold was slightly higher in value. Gold was traded at $1,919. 5 per ounce.