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Asian markets surge following Wall Street records

2 min

Hong Kong (AFP)

Asian markets surged Monday as investors tracked last week's record-breaking end on Wall Street, where the three major indices all hit fresh highs.

The rally comes during a strong earnings season, with major companies signalling higher profits in the wake of the tax cuts recently enacted in the United States.

With more data from top companies including Alibaba and Google's parent company Alphabet expected in the coming week, analysts say indications of improved profits could sustain the positive sentiment in the markets.

"A data-packed week and stock reporting seasons around the globe should see market focus turn to the numbers," said Michael McCarthy, chief strategist at CMC Markets in Sydney.

But he warned that "a weakening US dollar may prove a brake on any investor exuberance."

The greenback remains under pressure, and could experience more turbulence with several major announcements coming up this week, including US President Donald Trump's State of the Union address.

"We should expect more two-way uncertainty entering the fray this week which could make for some touch and go moments," said Stephen Innes, head of Asia-Pacific trading at OANDA. "But for now, the markets remain comfortable to maintain a longer-term soft USD bias."

Markets could also be impacted this week by the outcome of a scheduled US Federal Reserve meeting.

The Fed is expected to leave the benchmark US interest rate untouched at the meeting, but economists say the changing composition of the policy committee could point to faster rate hikes in 2018.

In early trade on Monday, Hong Kong was up 0.4 percent, Sydney rose 0.6 percent and Tokyo gained 0.5 percent.

Meanwhile, Seoul surged 1.1 percent and Shanghai gained 0.2 percent.

- Key figures around 0250 GMT -

Tokyo - Nikkei 225: UP 0.5 percent at 23,754.31

Hong Kong - Hang Seng: UP 0.5 percent at 33,320.86

Shanghai - Composite: UP 0.4 percent at 3,571.64

Euro/dollar: DOWN at $1.2391 from $1.2428 at 2200 GMT on Friday

Pound/dollar: DOWN at $1.4116 from $1.4155

Dollar/yen: UP at 108.92 yen from 108.63 yen

Oil - West Texas Intermediate: UP 17 cents at $66.31 per barrel

Oil - Brent North Sea: DOWN 12 cents at $70.40 per barrel

New York - DOW: UP 0.9 percent at 26,616.71 (close)

London - FTSE 100: UP 0.7 percent at 7,665.54 points (close)

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