Asian shares jump as Chinese leaders pledge help for economy

By ELAINE KURTENBACH
AP Business Writer

Asian stocks advanced Friday after Chinese leaders pledged to step up efforts to support the economy as the country weathers its worst outbreaks of COVID-19 since the pandemic began.

Oil prices also rose while U.S. futures were mixed.

Chinese state media reported that the ruling Communist Party’s powerful Politburo had pledged to step up efforts to boost growth while also curbing coronavirus outbreaks.

The party’s COVID-zero policies have put pressure on President Xi Jinping and other leaders to counter the blow to the economy from shutdowns aimed at vanquishing COVID-19. Such restrictions are affecting the world’s second-largest economy through disruptions in shipments, manufacturing and other business activity.

“It is very important to do a good job of economic work and to ensure and improve people’s livelihood,” the official Xinhua News Agency said in reporting the meeting.

The report indicated no change in the leaders’ strategy for fighting outbreaks.

But it said the meeting agreed on adjusting policies to keep the economy, which was slowing even before the latest waves of coronavirus infections, “operating in a reasonable range” and to speed up implementation of tax rebates and reductions, ensure enough energy supplies and help industries, small businesses and families severely affected by the pandemic.

The Shanghai Composite index gained 2.4% to 3,047.77 while Hong Kong’s Hang Seng index surged 3.3% to 20,941.61.

Tokyo was closed for a holiday, the first of several in Japan’s coming “Golden Week.”

In Seoul, the Kospi added 1% to 2,693.26, while Australia’s S&P/ASX 200 advanced 0.7% to 7,407.70.

The price of U.S. benchmark crude oil gained 83 cents to $106.19 per barrel. It jumped $3.34 to 105.36 per barrel on Thursday.

Brent crude, the basis for pricing international oils, gained $1.18 to $108.50.

After hours on Thursday, SEC filings showed Elon Musk sold 4.4 million shares of Tesla stock worth roughly $4 billion, most likely to help fund his purchase of Twitter.

Tesla shares closed Thursday down slightly at $877.51. They are down 17% so far this year.

Major stock indexes on Wall Street notched their biggest gains in more than six weeks Thursday, as technology companies clawed back some of the ground they had lost recently.

The S&P 500 rose 2.5% to 4,287.50 and the Dow Jones Industrial Average gained 1.8% to 33,916.39. The Nasdaq picked up 3.1% to 12,871.53.

Smaller company stocks also rallied. The Russell 2000 rose 1.8% to 1,917.94.

This week has been turbulent as investors review a heavy batch of corporate earnings from major tech companies, industrial firms and retailers.

Big Tech and communications companies have been behind much of the oscillations in the broader market as their pricey stock values have more weight.

Apple rose 4.5% in regular trading. It rose another 2.3% in after-hours trading after reporting stronger-than-expected results and increasing its dividend and stock repurchase program.

Chipmaker Qualcomm jumped 9.7% after easily beating Wall Street’s profit estimates. Facebook’s parent company Meta surged 17.6%, the biggest gain among S&P 500 stocks, after it beat Wall Street’s first-quarter profit forecasts and reported an encouraging increase in daily users.

Encouraging financial reports helped support gains for several other major companies. McDonald’s rose 2.9% following a strong earnings update. Southwest Airlines rose 2.1% after reporting solid revenue and telling investors it expects a profitable year as travel demand returns with the pandemic fading.

Amazon rose 4.7% in regular trading, but slumped 10.5% in after-hours trading after the online retail giant reported its first quarterly loss since 2015. The company reported a decline in sales and huge write-down of its investment in an electric vehicle startup.

Corporate report cards are hitting the market as Wall Street studies how inflation is affecting businesses and consumer spending.

Supply chain issues have been crimping business operations in many industries throughout the recovery from the pandemic and Russia’s war against Ukraine has worsened increases for energy and key food commodity prices.

The U.S. Federal Reserve is set to aggressively hike rates as it steps up its fight against inflation. The chair of the Fed has indicated the central bank may hike short-term interest rates by double the usual amount at upcoming meetings, starting next week. It has already raised its key overnight rate once, the first such increase since 2018.

The Commerce Department reported Thursday that the U.S. economy shrank last quarter for the first time since the pandemic recession struck two years ago. But the report showed consumers and businesses kept spending, despite rising prices suggesting demand is resilient.

Investors will get another update Friday on spending, a barometer for the economy as everything from food to clothing and gas becomes more expensive, when the Commerce Department releases its personal income and spending report for March.