Asian shares rise on optimism about US, China economies

TOKYO (AP) — Asian shares were mostly higher Wednesday as regional markets looked to strong economic signs out of the U.S. and China as drivers of growth.

Benchmarks rose in Japan, China and Australia, although shares dipped in South Korea. Analysts warned major risks remain, such as surging cases of COVID-19 in some countries in Asia, worries about global inflation and China's policies to curb infections.

“Expectations of economic growth in China and the U.S. will likely remain key to gauging recession fears. China’s ‘zero-COVID’ policy is still an important headwind for global growth,” said Anderson Alves at ActivTrades.

Japan's benchmark Nikkei 225 added 1.2% to finish at 29,222.77. Australia's S&P/ASX 200 rose 0.3% to 7,127.70. South Korea's Kospi lost 0.5% to 2,521.84. Hong Kong's Hang Seng added 0.6% to 19,948.66, while the Shanghai Composite edged up 0.5% to 3,292.53.

In New Zealand, the central bank raised its benchmark interest rate from 2.5% to 3% as it continues trying to battle inflation. The Reserve Bank of New Zealand said domestic spending had remained resilient in the face of local and global headwinds, and employment was robust. Lower oil prices had given some reprieve from inflation, the bank said, but it needed to continue tightening monetary conditions until inflation was brought back to its target range of 1% to 3%.

New Zealand’s inflation is running at 7.3% and unemployment at 3.3%.

In Japan, government data showed a trade deficit in July for the 12th consecutive month. Soaring oil prices and the sliding yen were key factors. Japan imports almost all its oil.

New cases of COVID-19 have been surging in recent weeks as restrictions on economic activities ease. Ambulances have had to circle for hours looking for hospitals that could accept...