Asian markets mostly rise on stimulus hopesBy Danny McCord
HONG KONG—Asian markets mostly rose Monday after more weak Chinese manufacturing data fuelled hopes for a fresh round of monetary easing by Beijing.
The downbeat figures out of China added to expectations of more stimulus measures in the United States following strong hints from Federal Reserve chief Ben Bernanke on Friday.
Hong Kong added 0.39 percent, or 76.64 points, to 19,559.21 and Shanghai ended 0.57 percent higher, adding 11.63 points to 2,059.15, while Sydney gained 0.31 percent, or 13.6 points, to end at 4,329.7.
Seoul put on 0.40 percent, or 7.59 points, to 1,912.71 but Tokyo slipped 0.63 percent, or 56.02 points, to 8,783.89.
Fears over growth in China were stoked again on Saturday when the official purchasing managers’ index (PMI) of manufacturing activity fell to a nine-month low of 49.2 in August from 50.1 in July, owing to slumping demand in the key export markets of Europe and the United States.
A reading above 50 indicates expansion, while one below 50 points to contraction.
And on Monday a PMI reading from HSBC showed August activity fell to its lowest level since March 2009.
The final reading of the British banking giant’s index slid to 47.6 from 49.3 in July.
The results add to rising concerns over China’s economic growth and come despite Beijing cutting interest rates and lowering the amount of cash banks must keep in reserve as it looks to boost activity.
China’s economy grew just 7.6 percent in the three months to June, the worst performance in three years and the sixth straight slowdown, while figures for trade, industrial output and retail sales in July were also weak.
The latest results will boost expectations of another cut to banks’ reserve requirements or even interest rates.
“The pace of growth has slowed much more than the authorities (in Beijing) expected,” Stephen Halmarick, head of investment markets research at First State Investments, told Dow Jones Newswires.
Global markets posted gains at the start of last month as dealers bet that central banks in China, Europe and the United States would announce fresh stimulus and easing policies, but the lack of action has led to selling pressure in the past few weeks.
In the United States, Bernanke on Friday told central bankers that stagnation in the labor market was “a grave concern” and signaled he would be pushing for more help for the economy.
His comments led to speculation that the Fed would undertake a third round of bond-buying, or quantitative easing, lifting US shares.
The Dow added 0.69 percent, the S&P 500 rose 0.51 percent and the Nasdaq climbed 0.60 percent.
However, Mizuho Securities senior technical analyst Yutaka Miura told Dow Jones Newswires: “Although Bernanke’s comments left hopes in markets, we still find it difficult to foresee when and whether the Fed will really take action.
“The external environment looks uncertain, with the Chinese economy deteriorating. Any aggressive bids may be limited.”
On currency markets the euro bought $1.2567 in early European trade from 1.2576 in New York late Friday.
The European currency was also trading at 98.50 yen compared with 98.51 late Friday.
The dollar was at 78.36 yen from 78.31 yen.
Oil eased, with New York’s main contract, light sweet crude for delivery in October, shedding 17 cents to $96.30 a barrel in the late afternoon and Brent North Sea crude for October falling 19 cents to $114.38.
Gold was at $1,688.65 at 1100 GMT compared with $1,658.80 on Friday.
In other markets:
– Singapore closed down 0.27 percent, or 8.24 points, at 3,017.22.
Jardine Cycle and Carriage fell 1.06 percent to Sg$45.80 and Sembcorp Industries shed 1.95 percent to Sg$5.54.
– Taipei gained 0.72 percent, or 53.47 points, to 7,450.53.
Hon Hai Precision surged 6.13 percent to Tw$90.0 while Taiwan Semiconductor Manufacturing Co. was 0.72 percent higher at Tw$83.9.
– Manila closed 0.44 percent higher, adding 22.89 points to 5,219.08.
Metropolitan Bank and Trust gained 1.86 percent to 92.75 pesos while Alliance Global Group rose 1.87 percent to 12 pesos.
– Wellington closed flat, edging up 2.35 points to 3,669.03.
– Jakarta jumped 1.42 percent, or 57.62 points, to 4,117.95.
Bank Mandiri rose 1.3 percent to 7,900 rupiah, consumer goods producer Unilever gained 3.7 percent to 28,100 rupiah, and mining company Aneka Tambang rose 0.81 percent to 1,250 rupiah.
– Kuala Lumpur climbed 0.47 percent, or 7.79 points, to 1,653.90.
Axiata Group gained 3.5 percent to 6.20 ringgit and YTL Power International Bhd was down 1.7 percent at 1.71 ringgit.
– Bangkok added 0.65 percent, or 8.0 points, to 1,235.48.
– Mumbai ended 0.26 percent down, or 45.16 points, to 17,384.4.
Jindal Steel slid 2.23 percent to 34.45 rupees and Tata Power fell 1.91 percent to 97.7 rupees.
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