Asian shares gain on strong factory data for China, Japan

Shares in Asia are higher after China and Japan reported stronger- than- expected factory data. Markets in China, Hong Kong, India and South Korea were closed Monday for national holidays.

KEEPING SCORE: Japan’s Nikkei 225 stock index rose 0.2 percent to 20,400.78 and the S&P ASX/200 jumped 0.8 percent to 5,729.30. Shares in Taiwan and Southeast Asia also gained.

WALL STREET LAST WEEK: The market ended the quarter on a four-day winning streak that began after Federal Reserve Chair Janet Yellen said the central bank plans to continue to raising interest rates. The Standard & Poor’s 500 index rose 0.4 percent to 2,519.36 and the Dow Jones industrial average eked out a 0.1 percent gain to 22,405.09. The Nasdaq composite jumped 0.7 percent to 6,495.96. The S&P 500 and Nasdaq both closed at all-time highs.

JAPAN ECONOMIC DATA: The Bank of Japan’s quarterly “tankan” survey showed an improved outlook for the world’s third-largest economy. The survey of leading manufacturers indicated growing shortages of factory capacity that could compel companies to invest more, helping to drive growth. Another, private sector survey, the Nikkei purchasing managers’ index, likewise showed manufacturers increasing output to meet a rise in new orders. Market reaction was muted, however, given other uncertainties such as the North Korean situation and a snap election planned for Oct. 22.

ANALYST VIEWPOINT: “The real question may be how the economic environment evolves with regards to snap elections and lingering geo-politics involving a nuclear-armed North Korea. The upshot is that after six successive quarters of growth, corporate Japan is still going strong, but politics and geo-politics may inadvertently be bugbears,” Mizuho Bank, Ltd. said in a commentary.

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