Asian shares gain after Wall Street rally

Stocks were mostly higher in Asia on Tuesday after Wall Street rallied in its latest about-face in recent topsy-turvy trading. Oil prices and US futures advanced and the dollar was trading near 149 Japanese yen.

A release of China's most recent economic growth figures was postponed Monday, taking away one factor that had been expected to drive trading. No specific reason was given, but the GDP report was likely to conflict with the confident tone of a Communist Party congress being held in Beijing, by showing the economy grew by as little as 3 per cent in the latest quarter, barely half the official 5.5 per cent target.

There was little immediate news from the gathering in Beijing, where the party is expected to unveil its top leadership for the next five years, a day after the congress closes.

Some analysts speculated that the delay was due to signs of further weakening in the economy. ING Economics said in a report that while the data weren't likely to “paint a particularly positive picture of the Chinese economy" when they are eventually released, “the delay suggests that the government believes that the 20th Party Congress is the most important thing happening in China right now and would like to avoid other information flows that could create mixed messages."

In any case, Asian shares tracked overnight gains, with Hong Kong's Hang Seng index up 0.9 per cent to 16,773.08. The Shanghai Composite index added 0.2 per cent to 3,089.74.

Tokyo's Nikkei 225 index rose 1.4 per cent to 27,143.85, while the Kospi in Seoul climbed 0.8 per cent to 2,237.13. In Australia, the S&P/ASX 200 advanced 1.4 per cent to 6,755.70. India's Sensex rose 1 per cent.

The dollar was trading at 148.86 Japanese yen, down from 148.98 yen. Senior Japanese officials have indicated they might intervene in the market to try to stem volatility and support the yen, which has weakened sharply against the dollar this year.

The euro rose to 98.51 cents from 98.41 cents.

On Monday, the S&P 500 climbed 2.6 per cent to 3,677.95. The Dow gained 1.9 per cent to 30,185.82, while the Nasdaq added 3.4 per cent to 10,675.80.

Traders also bid up small company stocks. The Russell 2000 index rose 3.2 per cent to 1,735.75.

Early Tuesday, the future for the S&P 500 was up 1.5 per cent, while that for the Dow industrials gained 1.2 per cent.

Nearly all of the stocks in the benchmark S&P 500 index rose, with technology and communications companies among the biggest gainers. Apple climbed 2.9 per cent and Google's parent company rose 3.7 per cent.

Bond yields eased back from their multiyear highs and took some pressure off stocks. The yield on the 10-year Treasury, which influences mortgage rates, held steady at 3.99 per cent. The yield on the 2-year Treasury, which tends to track expectations for future Federal Reserve action, fell to 4.46 per cent from 4.50 per cent late Friday.

The UK government bonds rallied following news that the country's new Treasury chief was abandoning nearly all of a series of unfunded tax cuts that had upset markets.

Wall Street indexes remain sharply lower from where they were at the beginning of this year. The S&P 500 and Russell are down more than 22 per cent, while the Nasdaq has slumped more than 31 per cent. The Dow is off nearly 17 per cent.

Investors are worried about hot Inflation and the potential for recession if interest rates by the Federal Reserve and other central banks to cool inflation go too far.

This week, the latest round of corporate financial results could help give investors a clearer picture of how companies and consumers are handling inflation.

On Monday, Bank of America CEO Brian Moynihan told analysts during a conference call following the release of the company's latest quarterly results that high inflation and worries of a recession haven't slowed its customers' spending. Moynihan said spending increased 12% in January-September from a year earlier.

Several major airlines, which could see some turbulence in their finances if inflation hits consumers' travel spending, will report earnings this week. United Airlines releases its results on Tuesday, followed by American Airlines on Thursday.

Other big names reporting earnings this week include Johnson & Johnson, Netflix, Union Pacific and American Express.

In energy trading, US benchmark crude oil gained 45 cents to $85.91 per barrel in electronic trading on the New York Mercantile Exchange. It lost 15 cents to $85.46 per barrel on Monday.

Brent crude, the basis for pricing international oil, picked up 36 cents to $91.98 per barrel.

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