Asia Markets

South Korea jumps nearly 3% as optimism over reopening economies buoys investor sentiment in Asia

Key Points
  • Shares in Asia were higher on Wednesday, with South Korea's Kospi jumping nearly 3%.
  • Developments surrounding the reopening of economies likely continued to be monitored by investors on Wednesday.
  • Australia's GDP fell 0.3% in seasonally adjusted, chain volume terms during the March quarter, according to data released Wednesday by the country's Bureau of Statistics.

Stocks in Asia largely rose on Wednesday, with optimism over the reopening of economies as authorities ease coronavirus-induced lockdown measures.

Over in South Korea, the Kospi led gains among the region's major markets as it rose 2.87% to close at 2,147, with shares of industry heavyweight Samsung Electronics skyrocketing 6.03%. The moves came after South Korea on Wednesday unveiled a 35.3 trillion won ($29 billion) supplementary budget, raising the total stimulus to 270 trillion won as it battles the economic hit from the coronavirus pandemic, according to Reuters.

Japan's Nikkei 225 also saw decent gains as it advanced 1.29% to finish its trading day at 22,613.76. The Topix index closed 0.72% higher at 1,599.08.

In Hong Kong, the Hang Seng index rose 1.22%, as of its final hour of trading, with shares of Chinese tech juggernaut Alibaba soaring 4.5%. Stocks in mainland China closed little changed, with the Shanghai composite fractionally higher at about 2,923.37 while the Shenzhen component dipped slightly to around 11,108.36.

Shares in Australia also saw gains, with the S&P/ASX 200 up 1.83% on the day to 5,941.60. Australia's GDP fell 0.3% in seasonally adjusted terms during the March quarter, according to data released Wednesday by the country's Bureau of Statistics.

Bank stocks in Asia Pacific also jumped amid the investor optimism. In Hong Kong, shares of HSBC gained 2.02% while China Construction Bank rose 0.48%. Meanwhile, Shinhan Financial Group's stock in South Korea soared 11.72%. Over in Singapore, DBS Group surged 6.83% while Oversea-Chinese Banking Corporation gained 4.05%. Commonwealth Bank of Australia and Westpac in Australia jumped 3.25% and 4.36%, respectively.

Overall, the MSCI Asia ex-Japan index rose 1.75%. 

Markets in Thailand were closed on Wednesday for a holiday.

Developments surrounding the reopening of economies likely continued to be monitored by investors on Wednesday.

"Investor remain on an optimistic mood, squarely focused on the prospect of economies reopening supported by COVID-19 stats that broadly speaking continue to suggest reopening plans remain on track," analysts at National Australia Bank wrote in a note.

Still, Nikko Asset Management's John Vail warned that the market may have gotten ahead of itself.

"We've been positive on the market since mid-March but certainly … all of them have shot way beyond … our targets," Vail, who is chief global strategist at the firm, told CNBC's "Squawk Box" on Wednesday.

"It does look like enthusiasm should be dialed down quite a bit for the market," Vail said, adding that the upcoming second quarter "earnings warning season" is likely to feature "more negative ones than positive ones."

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 97.358 after weakening in recent days following levels above 99.4 seen last week.

The Japanese yen traded at 108.63 per dollar after seeing an earlier low of 108.84. The Australian dollar changed hands at $0.6937, continuing its rally from levels below $0.68 seen earlier this week.

Oil prices jumped in the afternoon of Asian trading hours, with international benchmark Brent crude futures up 1.69% to $40.24 per barrel. U.S. crude futures also rose 2.36% to $37.68 per barrel.