File: Asian stocks mostly kicked off the year with gains on Tuesday.
HONG KONG - Asian stocks mostly kicked off the year with gains on Tuesday as traders drifted back to work after the festive break, with Hong Kong the standout performer, though the dollar faced fresh pressure from most other currencies.
Regional investors shrugged off dips in New York on the last day of 2017, instead building on the healthy advances fuelled by strong data, improving corporate profits and hopes Donald Trump&39;s tax cuts will fire US growth.
They were also keeping an eye on the release of key US jobs figures at the end of the week, which will provide fresh clues about the strength of the world&39;s biggest economy.
Hong Kong led Tuesday&39;s rally, jumping two percent to its highest level since late 2007, while Shanghai ended 1.2 percent higher, boosted by data showing manufacturing activity in China continued to expand in December.
The news comes as China&39;s leaders look to handle a tricky transition of the economy from state investment and exports to one driven by consumer demand, while also addressing a growing debt mountain and fighting pollution.
And Rajiv Biswas, chief Asia-Pacific economist at IHS Markit in Singapore, warned that Beijing&39;s success in this would have consequences around the world.
"Risks to the Chinese economy will remain among the key risks to the global growth outlook in 2018, with the Asia Pacific region particularly vulnerable to the shock waves from a slowdown," he told Bloomberg News.
Among other markets, Singapore rose 0.8 percent after figures showing the city-state&39;s economy beat estimates in the final three months of last year.
Seoul added 0.5 percent, with some optimism seen after North Korean leader Kim Jong-Un said he was open to talks with the South. On Tuesday the government in Seoul proposed holding high-level talks with Pyongyang on January 9.
Taipei was up 0.6 percent but Sydney slipped 0.1 percent. Tokyo and Wellington were closed for public holidays.
In early European trade London fell 0.2 percent, Frankfurt shed 0.1 percent and Paris was flat.
- Oil up, dollar down -
On currency markets, the dollar suffered further selling, with analysts pointing to profit-taking after the passage of the much-anticipated US tax cuts, as well as expected monetary tightening by other central banks that will align them with the Federal Reserve.
Greg McKenna, chief market strategist at AxiTrader, said the euro was rising as "traders are making the bet that the (European Central Bank) will simply follow the Fed in the year ahead and end quantitative easing and then move toward rate hikes".
The single currency was above $1.20 and sitting at levels not seen since September, while the pound was also at around three-and-a-half-month highs.
However, bitcoin was down from its late Monday levels as the cryptocurrency struggles to bounce back from a recent sell-off fuelled by profit-taking.
It had soared 25-fold over 2017 to a record high above $19,500 on December 18 before tumbling to just above $12,000 less than a week later.
It was sitting at $13,345 in Asia on Tuesday.
Oil prices edged up on the back of a weaker dollar, unrest in crude giant Iran and a pause in the number of rigs coming online in the United States.
"There is some momentum for oil at the moment and that could continue," Ric Spooner, a Sydney-based analyst at CMC Markets, said. He added that market-watchers felt an increase in US shale output appeared not to be as big as expected.
The increase comes after both main contracts enjoyed a second year of rises in 2017, largely thanks to an output freeze by Russia and OPEC.