Asian markets built on the previous day’s gains and headed into the weekend on a positive note Friday as traders were buoyed by news that Donald Trump’s tax cuts had moved a step closer.

House Republicans pushed through a landmark overhaul of the tax system on Thursday, providing the base for a record close in the Nasdaq on Wall Street at the end of a volatile week for global equities.

The plan, hailed by Trump and House Speaker Paul Ryan, would mark the biggest changes in three decades and see huge reductions for corporations and individuals.

Those gains filtered through to Asia, where Tokyo ended the morning session 0.2 percent higher, though an earlier rally was pared by a stronger yen.

Hong Kong added 0.8 percent and Sydney put on 0.3 percent. Seoul, Singapore, Taipei and Manila were also sharply higher but Shanghai dipped 0.3 percent.

The broad gains came at the end of a week that saw heavy selling fuelled by profit-taking and dealers’ worries that a rally in recent weeks had gone too far, pushing valuations too high.

“If the Senate can get its bill passed and if President Trump does end up with something on his desk he can sign into law stocks in Asia, America, and globally should catch a strong updraft and bid tone,” said Greg McKenna, chief market strategist at AxiTrader.

– Senate hurdle –

However, while the tax success in the House of Representatives came as a welcome boost, analysts warned there was still a long way to go for an agreement to get through the Senate.

The Republicans in the upper house have a wafer-thin majority and are already struggling to get all their members onside and there are worries the reforms could go the same way as the Obamacare repeal earlier in the year.

“Passing the legislation is a major win for President Trump but there is still work to be done if the bill is to make it through the US Senate,” Cai Lewis, senior adviser at ASR Wealth Advisers, said in a note.

“I have said before that I think that the bill will ultimately pass, which will make way for debate on the much-lauded US Infrastructure bill. Now to see if Trump has learnt the lessons from the failed Obamacare repeal attempts and takes a more pragmatic approach when trying to woo votes in the Senate.”

Uncertainty about the reforms’ future dragged the dollar, which had rallied on the news in US trade.

The greenback was well down against the pound, euro and yen, while higher-yielding currencies including the Australian dollar, Korean won and Mexican peso were also stronger.

Regional energy firms were mostly up after this week’s big losses fuelled by plunging oil prices but ongoing concerns about demand and warnings of higher stockpiles are keeping dealers on edge.

– Key figures around 0230 GMT –

Tokyo – Nikkei 225: UP 0.2 percent at 22,404.85 (break)

Hong Kong – Hang Seng: UP 0.8 percent at 29,251.57

Shanghai – Composite: DOWN 0.3 percent at 3,389.83

Euro/dollar: UP at $1.1812 from $1.1772 at 2200 GMT

Dollar/yen: DOWN at 112.55 yen from 113.02 yen

Pound/dollar: UP at $1.3240 from $1.3192

Oil – West Texas Intermediate: UP 19 cents at $55.33 per barrel

Oil – Brent North Sea: DOWN one cent at $61.35 per barrel

New York – DOW: UP 0.8 percent at 23,458.36 (close)

London – FTSE 100: UP 0.2 percent at 7,386.94 (close)

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November 17, 2017