Asian stocks gain for a second day after data showed the economic resilience of US and China, outweighing the Trump administration’s mixed signals on North Korea’s latest missile provocation.
About five stocks gained for every three that declined on the MSCI Asia Pacific Index, which added 0.1% to 160.51 as of 3:40pm in Hong Kong. US data showed second-quarter growth in the world’s biggest economy reached the fastest pace in two years on stronger household spending and a bigger gain in business investment, while China’s official factory gauge further strengthened in August, defying economist forecasts for a decline.
“The US and China data support the outlook that the global recovery is gaining ground and the growth is on a strengthening trajectory that will be good for corporate earnings and exporters to these two markets,” said Cristina Ulang, head of research at First Metro Investment Corp in Manila. “North Korea remains a concern, but the expectation is this will be settled through diplomacy for we all stand to lose more from a nuclear confrontation.”
A day after adopting a measured response to North Korea’s missile launch across Japan, President Donald Trump took a tougher stance on Wednesday, posting on Twitter that “talking is not the answer!” Defense Secretary Jim Mattis said later Wednesday that diplomacy remains an option. After the MSCI Asia Pacific Index closed on August 2 at the highest since 2007, concern over rising tension between US and North Korea has limited its monthly gain to 0.1%, the weakest performance this year. The regional benchmark is still heading for its eighth straight month of gains in the longest winning streak in a decade, and has climbed 19% so far this year.
Shares in Japan rose yesterday as the yen weakened for a third day, while a drop in banks pushed Hong Kong stocks lower from the highest level since May 2015. A gauge of health-care companies led the advance among the MSCI Asia Pacific Index’s 11 industry groups, climbing 0.5%. The Malaysian market is shut for a 
holiday.
Fosun International Ltd, the listed flagship of Chinesebnaire Guo Guangchang’s insurance-to-drugs conglomerate, jumped as much as 11% in Hong Kong, its biggest gain since July 2015. The company said post-market Wednesday that first-half net income increased 34% amid higher returns from investments. Chief executive officer Wang Qunbin said yesterday that the company’s overseas expansion will benefit from recent government rules on outbound investment.