Asia report: Most markets higher as China surges, Aussie PM hangs by thread

Stocks in Asia finished mostly higher on Monday, led higher by mainland China, which surged amid regulatory promises to support that country’s share market.

In Japan, the Nikkei 225 was up 0.37% at 22,614.82, as the yen weakened 0.27% against the dollar to last trade at JPY 112.85.

The broader Topix index was ahead 0.15% in Tokyo, at 1,695.31.

On the mainland, the Shanghai Composite rocketed 4.09% to 2,654.88, and the smaller, technology-heavy Shenzhen Composite surged 4.9% to 1,325.73.

Sentiment in China was given a boost after Beijing promised on Friday to implement measures intended to support the market, after the latest official GDP data came in weaker than anticipated amid a trade war with the US.

South Korea’s Kospi was 0.25% higher at 2,161.71, while the Hang Seng Index in Hong Kong rode the back of gains in mainland China to rise 2.32% to 26,153.15.

Oil prices were higher, with Brent crude up 0.3% to $80.02 per barrel and West Texas Intermediate rising 0.33% to $69.51.

In Australia, the S&P/ASX 200 was the odd one out, falling 0.58% to settle at 5,904.90, with the energy sector off 0.82% and the hefty financials subindex down 0.75%.

Traders in the sunburnt country were once again jittery about political stability in Canberra, as prime minister Scott Morrison - who only took power in a leadership spill several weeks ago - was forced to meet with independent politicians to secure support for his government.

His ruling Liberal party was faced with a 20% swing against it in a by-election in suburban Sydney over the weekend, meaning it looks set to lose its one-seat majority.

Morrison will need to rely on at least one of five independent members to ensure his ability to govern.

“It will increase market conviction that as and when the next election does occur - no later than May 2019 - it is likely to produce a change of government,” noted National Australia Bank’s head of foreign exchange strategy Ray Attrill.

Across the Tasman Sea, investors in New Zealand were enjoying a quiet day compared to their Australian colleagues, as markets remained closed for the Labour Day holiday there.

Both of the down under dollars were weaker on the greenback, with the Aussie last off 0.22% at AUD 1.4078 and the Kiwi retreating 0.18% to NZD 1.5199.