Asian stocks, USD rise on US economic optimism in early trade Wed

TOKYO: Asian stocks inched higher on Wednesday and the dollar held near an eight-week peak against a basket of currencies, spurred by upbeat US economic data and yet another record close for the S&P 500.

Riskier asset markets were underpinned overnight after the US reported an unexpected rise in durable goods orders in April and higher home prices for March. Services industries, which dominate the economy, also grew at a rapid clip in May.

"Not only did the S&P print a record high, it also closed right at the highs, which is a positive sign and says a lot about momentum," Stan Shamu, market strategist at IG in Melbourne, said in a note to clients.

MSCI's broadest index of Asia-Pacific shares outside Japan tacked on gained 0.15%. Tokyo's Nikkei 0.2%, and Australian stocks put on 0.3% in morning trade.

The recent run of largely upbeat US data has helped underpin global equities even as a slowdown in China remains a worry.

The Federal Reserve's commitment to continue to support the world's biggest economy and indications the European Central Bank (ECB) will take easing steps to prop up sluggish growth in the euro zone have also calmed investor nerves.

On Wall Street, the Dow Jones industrial average gained 0.42%, and the S&P 500 advanced 0.60% to 1,911.91, a new record.

The economic optimism steered the dollar index which measures the greenback's strength against a basket of key currencies, to a high of 80.470 - a level last seen in early April. It last traded at 80.343.

The dollar, which was also supported by a rise in US Treasury yields, fetched 101.98 yen, within striking distance of a two-week high of 102.145 hit on Tuesday.

The euro remained on the defensive after comments from ECB President Mario Draghi again highlighted the bank's discomfort over persistently low inflation and suggested some kind of policy action was likely at the June 5 meeting.

The euro was little changed at US$1.3635, hovering near a three-month low US$1.3612 plumbed on Tuesday.

In commodities, the improved risk appetite eroded gold's safe-haven appeal. Spot gold slipped to as low as US$1,262.90 an ounce, its lowest since Feb. 7. - Reuters