Asian Shares Boosted By Stronger China Factory Data

Asian shares were mostly higher on Monday buoyed by further signs of recovery in China's manufacturing sector.

Japan's benchmark Nikkei 225 added 1.4 percent to 23,303.42 in morning trading, while South Korea's Kospi gained nearly 0.9 percent to 2,287.17. Australia's S&P/ASX 200 added 0.4 percent to 5,952.40. Hong Kong's Hang Seng edged up 0.7 percent to 24,277.75, while the Shanghai Composite inched down less than 0.1 percent to 3,221.78.

The Caixin manufacturing PMI, a major indicator for China's manufacturing sector, rose in October, showing that domestic demand is holding up. But if coronavirus cases continue to rise in the US and Europe, that's likely to hurt China's exports.

Still, a resurgence of outbreaks of COVID-19 has investors worried, on top of uncertainty over the US presidential election.

The government’s top infectious diseases expert has cautioned that the U.S. will have to deal with “a whole lot of hurt” in the weeks ahead due to surging coronavirus cases. Dr. Anthony Fauci said in a Washington Post interview that the US “could not possibly be positioned more poorly” to stem rising cases as more people gather indoors during the colder fall and winter months.

Aside from pandemic and election concerns, market players are looking ahead to a slew of earnings reports expected from Japan and the rest of the region, including automakers and video-game maker Nintendo Co.

“With voters in the US going to the polls this week, or more accurately, not going to the polls, having already cast their postal votes in huge numbers, Asia will be looking nervously westwards this week, wondering what the outcome will be, and that it will mean for them,” said Robert Carnell, regional head of research for ING.

The focus is on US China relations, but investors aren't sure what change either outcome might bring on that issue. Although Democratic candidate Joseph Biden might go easier on tariffs, say he is unlikely to soften US policy on other issues such as human rights, Carnell said in a report. (AP)