Asian markets jump after Wall Street rally
HONG KONG—Asian markets surged on Thursday, following another rally on Wall Street and ahead of a speech by Fed chief Ben Bernanke that many hope will outline plans to kickstart the ailing US economy.
The more positive mood – helped by a strong batch of US manufacturing data – saw safe haven assets fall, with gold tumbling further from its record high above $1,900 and the yen weakening.
Regional firms with links to Apple slipped while its rivals rose after Steve Jobs announced his resignation as chief executive of the US computer giant on Wednesday.
Tokyo closed 1.54 percent, or 132.75 points, higher at 8,772.36 while Seoul rose 0.56 percent, or 9.80 points, to 1,764.58 and Sydney added 0.98 percent, or 45.2 points, to 4,212.8.
Hong Kong rose 1.47 percent, or 285.69 points, to 19,752.48 while Shanghai soared 2.92 percent, or 74.17 points, to 2,615.26.
Traders took their cue from a third straight day of gains on Wall Street, where sentiment was boosted by data from the US Commerce Department showing new orders for durable goods rebounding 4 percent in July from June, suggesting manufacturing growth could pick up in the coming months.
Markets were also buoyant as they awaited Bernanke’s speech on Friday, which will be closely watched for signs of whether he endorses a further loosening of monetary policy to boost the world’s leading economy.
Last year, during a speech at the same annual conference he hinted that the Fed might launch a second round of quantitative easing – essentially, injecting fresh money into the economy in a bid to pump up growth. The Fed later carried through on the policy, fuelling a months-long stock surge.
On Wednesday the Dow rallied 1.29 percent, the S&P 500 rose 1.31 percent and the Nasdaq added 0.88 percent.
The upbeat sentiment sent the price of gold tumbling further just days after it hit a record high $1,913. The precious metal closed in Hong Kong at $1,738-$1,739 an ounce, down from $1,850-1,851 on Wednesday.
On currency markets the yen was slightly down from the previous day’s highs.
The dollar rose to 77.07 yen in Tokyo morning trade from 76.97 yen in New York late Wednesday. It had been at 76.64 in Asia Wednesday.
Against the Japanese currency the euro edged up to 111.16 yen from 110.97 in New York Wednesday and 110.49 in Asia.
The euro bought $1.4418, just up from $1.4413 in New York.
However, despite the brighter data Kazuhiro Takahashi, general manager of investment strategy and research at Daiwa Securities in Japan, offered a note of caution.
“The three-day advance in US stocks is prompting bargain-hunting and short-covering, but overall sentiment still leans towards pessimism and trading will likely continue to be volatile going into next week,” he told Dow Jones Newswires.
In the technology sector Apple-reliant shares were lower after Jobs – considered the soul of the firm – said he would resign as the firm’s CEO.
Shares in the maker of the iPhone and iPad tumbled 5.3 percent in after-hours US trade.
Taiwan component supplier Hon Hai, the parent company of Foxconn, which assembles Apple’s popular gadgets, shed 4.63 percent and while touchscreen maker Wintek dived seven percent and Catcher Technology, which builds casings for Apple gadgets, also lost seven percent.
However, Apple rivals rose, with HTC gaining 1.4 percent in Taipei and in Seoul Samsung Electronics rose 2.4 percent while LG Electronics, the world’s third-biggest mobile phone maker, climbed 1.27 percent.
Oil continued to edge back up as rebels and pro-government forces carried on battling it out in the Libyan capital of Tripoli.
Brent North Sea crude for October delivery was 10 cents up at $110.25. The contract had tumbled this week as it looked like the six-month battle for Libya was drawing to a close, which would allow oil to flow again.
New York’s main contract, West Texas Intermediate light sweet crude for October delivery fell nine cents to $85.07 a barrel.
In other markets:
— Singapore closed 1.69 percent, or 45.84 points, higher at 2,765.74 .
United Overseas Bank fell 0.73 percent to Sg$17.80 and DBS Group Holdings was 0.54 percent higher at Sg$12.98.
— Taipei fell 1.23 percent, or 92.06 points, to 7,410.87.
— Manila closed 0.54 percent, or 23.76 points, lower at 4,342.69.
Lepanto Mining shed 10 percent to 1.6 pesos and San Miguel was unchanged at 124 pesos.
— Wellington closed up 0.43 percent, or 14.06 points, at 3,301.58.
Air New Zealand fell 1.8 percent to NZ$1.09 after posting a 45 percent fall in adjusted full year earnings, while Fletcher Building was unchanged at NZ$7.85 and Telecom Corp. rose 0.7 percent to NZ$2.72.
— Kuala Lumpur ended down 0.30 percent, or 4.41 points, at 1,464.74.
RHB Capital fell 6.5 percent to 8.32 ringgit, CIMB Group shed 4.6 percent to 7.25 and Malayan Banking lost 0.1 percent to 8.73.
Genting added 2.7 percent to 9.78 ringgit and MMC Corp. gained 2.4 percent to 2.60 ringgit.
— Jakarta closed flat, edging down 2.65 points to 3,844.37.
Gas distributor Perusahaan Gas Negara shed 3.2 percent to 3,000 rupiah, while food producer Indofood lost 3.9 percent to 6,200 rupiah.
— Bangkok fell 2.05 percent, or 21.43 points, to 1,025.
Banpu lost 0.68 percent to 590, while PTT lost 1.9 percent to 309.
— Mumbai fell 0.85 percent, or 138.65 points, to 16,146.33.
India’s second-largest outsourcer Infosys Ltd fell 2.68 percent to 2,189.65 rupees while housing finance firm HDFC fell 2.65 percent to 628.85 rupees.
