Asian shares mostly higher after US rally, aid package hopes

Asian shares were mostly higher in muted trading Monday, as worries about the pandemic kept optimism in balance despite a rally that closed out last week on Wall Street.

Investors growing wary over upcoming earnings reports have been cashing in recent gains, helping pull Japanese shares lower. Tokyo's benchmark Nikkei 225 index lost 0.3% to complete at 23,558.69. Big exporters logged a number of the largest losses, with Toyota Motor Corp. falling 0.8% and Honda Motor Co. shedding 1.8%.

Japan reported core private sector machinery orders edged 0.2% higher in August, unlike forecasts for a decline. But overall, financial indicators remain weak.

Other regional benchmarks were rising. South Korea's Kospi gained 0.5% to 2,403.12. Australia's S&P/ASX 200 gained 0.5% to 6,132.00. Hong Kong's Hang Seng jumped 2.2% to 24,654.77, as the Shanghai Composite added 2.4% to 3,350.22.

“While U.S. politics remain center stage, a string of Asia releases and monetary policy meeting decisions will be watched this week,” said Jingyi Pan, senior market strategist at IG in Singapore, discussing central bank meetings in South Korea, Indonesia and Singapore.

Indicators out of China, such as for example trade and inflation readings, also stick to investors' minds.

Wall Street closed out its best week in three months on Friday as negotiations on Capitol Hill targeted at delivering more aid to the ailing U.S. economy encouraged investors. The S&P 500 rose 0.9% to 3,477.14, its third straight gain. The benchmark index ended the week with a 3.8% gain, its strongest rally since early July.

Signs as of late Sunday weren't promising. A fresh White House coronavirus aid proposal got bad reviews from both ends of the political spectrum. House Speaker Nancy Pelosi rejected the most generous Trump administration plan to date as “one step forward, two steps back.” The Republicans who control the Senate are dismissing it as too expensive and a political loser for conservatives.

On Friday the White House increased its offer to $1.8 trillion, up from $1.6 trillion, according to a Republican aide acquainted with the plan. Pelosi’s most recent public proposal was about $2.2 trillion, though that included a business tax increase that Republicans won’t go for.

Worries persist that Congress and the White House won’t deliver more support for the economy as it reels from the impact of the pandemic and concerns that stock prices simply got too much during the summer.

Economists say the outlook is grim without such support, and the chair of the Federal Reserve has said repeatedly it'll be necessary.

The Dow Jones Industrial Average gained 0.6% to 28,586.90, creeping into positive territory for the entire year. The Nasdaq composite climbed 1.4%, to 11,579.94, as the Russell 2000 index of small-company stocks jumped 0.6% to at least one 1,637.55.

Other major challenges remain, chief among them the still-spreading coronavirus pandemic, highlighted by Trump’s own COVID-19 diagnosis.

In energy trading, US. benchmark crude lost 45 cents to $40.15 a barrel in electronic trading on the New York Mercantile Exchange. It lost 59 cents to $40.60 per barrel on Friday.

Brent crude, the international standard, fell 44 cents to $42.41 a barrel.

The U.S. dollar rose to 105.50 Japanese yen from 105.53 yen last Friday. The euro slipped to $1.1813, from $1.1824.