Asia: Stocks gain even as Topix swings, yen rises

[SYDNEY] Asian stocks rose even as Tokyo shares wrestled with a strengthening yen, as markets from Hong Kong to Singapore advanced after US shares reached fresh records. The US dollar fell against most major currencies while oil continued a rally.

Japan's Topix index fluctuated as the yen increased, while Chinese shares traded in Hong Kong climbed back toward the highest levels since Nov 2015.

Oil extended gains above US$54 a barrel after Opec's top official said the group intends to achieve full compliance with a deal to trim production.

The US dollar slipped as Federal Reserve Bank of Cleveland President Loretta Mester said policy makers don't want to surprise the market on interest rates.

Money managers are grappling with political uncertainty as the Fed prepares to lift interest rates again later this year. Expectations for an interest-rate increase at the Fed's next policy meeting have been on the rise since Chair Janet Yellen indicated Feb 14 that she foresees additional tightening this year regardless of whether President Donald Trump follows through on plans to pursue a pro-growth fiscal policy.

Ms Mester, in a Bloomberg Television interview from Singapore, reiterated comments made on Feb 20 that she would be "comfortable" with higher rates in response to upticks in inflation, though she said the Fed was not yet "behind the curve" in addressing price pressures.

Here are some events that investors are watching out for:

The Fed releases minutes Wednesday from its most recent meeting, possibly giving investors a look into how members see Donald Trump's policies. Data should show the US housing market perking up at the start of the year.

It's International Petroleum Week in London and top Opec, government and company officials are attending.

Currencies

The Bloomberg Dollar Spot Index fell 0.1 per cent as of 12:39pm in Tokyo, after advancing 0.2 per cent on Tuesday.

The yen rose 0.2 per cent to 113.44 per US dollar. The South Korean won climbed 0.4 per cent and the Australian dollar gained 0.2 per cent.

Stocks

The MSCI Asia Pacific Index rose 0.4 per cent to the highest since July 2015. The Topix was little changed, after swinging between gains of 0.3 per cent and losses of as much as 0.2 per cent.

The Hang Seng Index jumped 0.7 per cent. Hong Kong's economy may expand by 2 per cent to 3 per cent in 2017, faster than the 1.9 per cent gain last year, Financial Secretary Paul Chan told lawmakers in the annual budget speech.

The Hang Seng China Enterprises Index advanced 1.1 per cent. Taiwan's Taiex Index added 0.4 per cent and Singapore's Straits Times Index increased 0.4 per cent.

Futures on the S&P 500 were little changed. The index added 0.6 per cent Tuesday, with the Dow Jones Industrial Average, the Nasdaq Composite Index and the Russell 200 Index closing at all-time highs.

Banking stocks in Europe fell one per cent on Tuesday after HSBC missed earnings estimates and said it will boost cost-cutting measures and extend a stock buyback. The Stoxx Europe 600 index advanced 0.6 per cent for a third straight gain that left it at the highest since December 2015.

Bonds

The yield on 10-year Treasuries rose one basis point to 2.44 per cent.

Australian 10-year yields climbed three basis points to 2.83 per cent.

Commodities Oil rose 0.7 per cent to US$54.46 a barrel, adding to Tuesday's 1.2 per cent gain.

Gold was little changed at US$1,236.22, after alternating between gains and losses over the previous four sessions.

BLOOMBERG