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Asian stocks advance amid earnings as Dollar gains; Oil steady

Asian stocks rose to a two-week high after U.S. shares rallied amid a flurry of takeovers and better-than-expected corporate earnings. The dollar strengthened versus most peers.

Almost three shares advanced for every one that fell on the MSCI Asia Pacific Index in early Asian trading and U.S. equity index futures edged higher following the S&P 500 Index’s best close in two weeks. Benchmarks gained in Australia, Japan and New Zealand, while South Korea’s declined. Crude oil was little changed, having lost ground on Monday after Iraq threatened to derail OPEC’s planned output cuts by saying it should be exempt.

Asian Stocks Advance Amid Earnings as Dollar Gains; Oil Steady (Bloomberg / MANILA BULLETIN)

Asian Stocks Advance Amid Earnings as Dollar Gains; Oil Steady
(Bloomberg / MANILA BULLETIN)

The U.S. earnings season has so far given a lift to investor sentiment, with about 80 percent of the companies to have reported so far beating estimates, and the pace of announcements picks up this week with more than a third of S&P 500 members scheduled to report. Apple Inc., the world’s biggest company, is due to release its quarterly results on Tuesday and an update from second-ranked Alphabet Inc. is expected on Thursday.

“We face a sizeable amount of event risk this week, but it seems the bulls are getting the upper hand in a number of equity indices,” said Chris Weston, chief market strategist at IG Ltd. in Melbourne. “Good buying has been seen in the technology and staples sectors, and tech will play a big role in price action for the remainder of the week, with Amazon, Apple and Alphabet out with numbers.”

The MSCI Asia Pacific Index added 0.3 percent as of 9:28 a.m. Tokyo time. Australia’s S&P/ASX 200 Index rose 0.7 percent and Japan’s Topix gained 0.7 percent. While markets in Hong Kong haven’t started trading yet, futures on the city’s Hang Seng and Hang Seng China Enterprises Index slipped as much as 0.3 percent.

Futures on the S&P 500 Index advanced less than 0.1 percent after the underlying benchmark climbed 0.5 percent on Monday.

The Bloomberg Dollar Spot Index held close to a seven-month high following three days of gains. The euro fell 0.1 percent versus the greenback and the yen was down 0.2 percent.

The Canadian dollar was 0.5 percent weaker and near a seven-month low, having been whipsawed following remarks Bank of Canada Governor Stephen Poloz.