Coronavirus | Asian shares rise to one week high as profit rises

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SYDNEY, Aug 4 - Asian shares shrugged off caution over the rapidly spreading Delta variant of the coronavirus to advance to one week highs on Wednesday led by strong U.S. corporate earnings and successful vaccine rollout globally.

In a sign that positive mood will extend overseas, Eurostoxx 50 futures added 0.3% while those for the London FTSE and the German Dax FTSE gained 0.1% each. U.S. futures were slightly weaker with the E-minis for the S&P 500 a nudge lower.

The Asian markets started on a jittery note but bounced strong in mid-morning trading.

MSCI's broadest index of Asia-Pacific shares outside Japan was last 1,1% higher for its second straight day of gains to the highest since July 26.

The China-Nippon was in the red while Japanese stock indexes started moving positive after starting downward. The SSE Composite added 0.7% as did the blue-chip index of Shanghai.

Australian shares were a touch firmer, though sentiment was marred by an unabating rise in Delta infections in Sydney, the biggest city in the country.

Most other Asian indexes were higher also.

Stronger-than-expected profits from U.S. companies in recent weeks have ratcheted up already high Wall Street forecasts on how second-quarter earnings growth will look compared last year.

Near to 90% of companies listed on the S&P 500 have reported positive earnings surprises for the second quarter, according to National Australia BankAustralia Bank economist Tapas Strickland.

Our baseline forecast for strong global growth to gather steam in 2 H 21 has remained unchanged in recent months, JPMorgan analysts wrote in a note.

The central pillar of our economic outlook is that vaccines will sever the link between COVID - 19 and global activity, they added.

Although we expect this process to take place gradually, we project progress on this path to be sufficient to unleash significant pent-up demand in 2 H 21. The growth bounce is already well established in Europe and we believe it started in the U.S. last quarter.

Investors were concerned about the broader economic outlook with Australia's largest city in its sixth week of lockdown and others battling a spike in infections.

Chinese media have reported 31 provincial regions have warned residents against unnecessary travel in light of recent outbreaks. The mainland transmitted 96 new cases for Aug. 3, of which 71 were locally reported and made local.

Strickland started city-wide testing in an eerie echo to the original COVID - 19 outbreak, NAB's Wuhan said.

While China's resolve to control outbreaks has been well illustrated, markets will continue to watch the outbreak given the high transmissibility of the Delta variant. There are also concerns that the border vaccinations do not work against China's domestic variant.

Wall Street's major stock indexes were higher overnight, but ended higher with notable gains from Apple Inc., Eli Lilly and Robinhood Markets Inc.

The S&P 500 gained 0.8% to close at 4,423. 15 - another high closing record - whilst the Dow rose 0.8% and the Nasdaq added 0.6%.

Investors expect volatility to increase in August as more companies report earnings and the market hears from Federal Reserve officials in coming weeks. U.S. non-farm payroll numbers will be due on Friday.

The U.S. dollar eased against the Japanese yen and Swiss franc as questions about slowing U.S. economic growth and the Delta variant challenged risk appetite.

The rupee was near a two-month low against the yen at 109.06. Against the Swiss Franc, the dollar hovered near its lowest since mid-June at $0.9034.

The New Zealand dollar walked higher after hard jobs data cemented expectations for an interest rate hike this month. The kiwi gained $7066, a gain of 1% for the week so far.

The risk-sensitive Australian Dollar was relatively upbeat at $0.7396, but that was largely due to a positive economic assessment by the central bank on Tuesday.

In commodities, Brent futures add 4 cents to $72.45 a barrel. U.S. crude settled down 13 cents for $70.43 a barrel.