Stocks in Asia Rally on Stronger-than-Expected US Retail Sales Report

Stocks in Asia rallied on Thursday as investors responded to reports of Japan’s record trade deficit of 3.5 trillion yen ($26 billion), the worst ever recorded since March 2006. Investors also digested a stronger-than-expected US retail sales report.

Nikkei 225 up 0.68% at 9:19 a.m. (Thai time); Japanese yen marginally stronger after trade data release. The benchmark Kospi index in South Korea increased by 1.69%.

The S&P/ASX 200 in Australia was trading 0.72% higher after the country’s unemployment rate for January came in higher than predicted.

The Hang Seng index in Hong Kong gained by 1.10%. The Shanghai Composite index rose by 0.39 percent in mainland China.

The Dow Jones Industrial Average led the way higher, gaining over 250 points to end the day at 34,128.05. The S&P 500 and Nasdaq Composite also ended the day higher, by 0.28% and 0.92%, respectively.

Government data indicated that Japan’s trade deficit increased to 3.5 trillion yen ($26 billion) in January, a 59% widening from the 2.2 trillion yen recorded in the same time a year ago.

Annualized, exports increased by 3.5% to 6.55 trillion yen, while imports increased by 17.8% to slightly over $10 trillion.

On Wednesday, the US Commerce Department reported that advance retail sales for the month had grown by 3%, exceeding predictions of a growth of 1.9%. Without accounting for inflation, the study shows that sales increased by 2.3% excluding automobiles. With cars removed, analysts predicted a 0.9% increase.
Food services and drinking places increased 7.2%, leading all major sectors. The automotive parts and components industry grew by 5.9%, while the furniture and home goods sector grew by 4.4%.