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Asian shares higher on positive signs from Fed

/ 11:44 PM May 08, 2014

People walk past an electronic stock indicator in Tokyo on Thursday, May 8, 2014. Asian stock markets were mostly higher Thursday after China’s trade improved and Federal Reserve Chair Janet Yellen vowed low interest rates would continue until the US job market is healthy. AP PHOTO/SHIZUO KAMBAYASHI

HONG KONG—Asian stocks rose Thursday, buoyed by the Fed chief’s comments that the US is on track for solid growth in the second quarter and positive trade data from China.

Markets took heart after Federal Reserve Chair Janet Yellen told Congress the US economy was on track for “solid growth” in the second quarter and that the stimulus taper would continue steadily.

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Tokyo reversed the previous day’s fall to close up 0.93 percent, or 130.33 points, at 14,163.78.

“It’s a rebound from yesterday’s sharp fall—the market is getting support from a brisk session on Wall Street,” said Tokai Tokyo Securities strategist Seiichi Suzuki.

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Seoul ended up 0.55 percent, or 10.72 points, at 1,950.60 while upbeat Australian jobs figures saw Sydney add 41 points, or 0.75 percent to close at 5,476.8.

Hong Kong rose 0.42 percent, or 90.86 points, to 21,837.12 while Shanghai added 0.26 percent, or 5.19 points, to 2,015.27.

“It has been a fairly busy day in Asia, with investors focusing on Australian jobs and China trade balance data,” said IG market strategist Stan Shamu.

Chinese stocks rose after the release of April trade data, which showed exports and imports rising marginally, rebounding from sharp declines the month before, with the country reporting a second straight trade surplus.

The figures come a month after Customs reported that China’s trade volumes fell dramatically in March, which analysts blamed on the continued impact of fake reporting of exports seen in early 2013.

“China’s trade data show signs of recovery but continue to understate the true health of the export sector,” Julian Evans-Pritchard, China economist at Capital Economics in Singapore, wrote in reaction to the April figures.

The figures lifted Shanghai stocks but dealers said uncertainty over the domestic economy may cap gains.

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“Trade figures didn’t seem to have any big impact on the market as the rises were mainly driven by small-cap stocks on the main board,” Haitong Securities analyst Zhang Qi told AFP.

“It’s still uncertain whether the recovery in trade will be sustainable,” he said.

Surprise comments from Putin

US stocks had finished mostly higher Wednesday following conciliatory statements by Russian President Vladimir Putin, who told pro-Russian rebels fighting in east Ukraine to halt plans for independence referendums.

Putin also said his troops have pulled back from the border, but both NATO and Washington said there was no evidence of a withdrawal.

The surprise comments, which suggested a potential de-escalation of the conflict that had been building toward war, sent Russia’s stock market soaring while the battered ruble jumped to a five-week high against the dollar.

The Dow Jones Industrial Average rose 0.72 percent to 16,518.54, while the Nasdaq Composite Index fell 0.32 percent to 4,067.67.

The dollar was at 101.74 yen in Tokyo, down from 101.87 yen in New York Wednesday afternoon after Yellen’s testimony.

The euro fetched $1.3937 and 141.68 yen, against $1.3911 and 141.74 yen in US trade, as the European Central Bank holds a policy meeting later in the day.

The ECB is widely expected to hold off launching fresh stimulus measures at its monthly meeting Thursday.

Oil prices were lower. The US benchmark, West Texas Intermediate for June delivery, was down 36 cents to $100.41 in afternoon trade while Brent North Sea crude for June eased 50 cents to $107.63 per barrel.

Gold was $1,292.06 an ounce at 1055 GMT, down from $1,311.59 late Wednesday.

In other markets:

— Singapore rose 0.35 percent, or 11.26 points, to close at 3,247.69.

Vehicle distributor Jardine Cycle and Carriage eased 0.09 percent to Sg$44.36 while Oversea-Chinese Banking Corporation gained 0.10 percent to Sg$9.75.

— Bangkok fell 1.68 percent, or 23.59 points, to 1,379.02.

Coal producer Banpu shed 3.33 percent to 29 baht, and energy giant PTT Plc lost 1.61 percent to 305 baht.

— Kuala Lumpur gained 2.41 points, or 0.13 percent, to 1,862.84.

Westports Holdings added 3.4 percent to 2.74, while YTL rose 0.6 percent to 1.64. Budget carrier AirAsia lost 1.8 percent to 2.20 ringgit.

— Jakarta ended down 1.18 points, or 0.02 percent, at 4,860.89.

Cement firm Indocement Tunggal Prakarsa gained 3.03 percent to 22,075 rupiah, while tyre manufacturer Goodyear Indonesia fell 5.41 percent to 17,500 rupiah.

— Taiwan rose 37.68 points, or 0.42 percent, to 8,930.9.

Acer climbed 1.04 percent to Tw$19.4 while TSMC was 0.84 percent higher at Tw$119.5.

— In Wellington, the NZX-50 fell 27.72 points, or 0.53 percent, to 5,161.41.

Z Energy slipped 1.29 percent to NZ$3.83 and Trade Me dipped 1.25 percent to NZ$3.95.

— Manila added 0.25 percent, or 16.70 points, to 6,765.21.

Philippine Long Distance Telephone Co. edged up 0.07 percent to 2,894 pesos while Ayala Corp. put on 0.48 percent to 628 pesos.

— Mumbai inched up 0.09 percent, or 20.14 points, to 22,344.04.

Marico climbed 4.06 percent to 239.85 rupees and Bharat Heavy Electricals advanced 3.22 percent to 184.25 rupees.

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