A currency trader watches the computer screens at the foreign exchange dealing room of the Korea Exchange Bank headquarters in Seoul, South Korea, Wednesday, Sept. 3, 2014. Asian stock markets rose Wednesday, lifted by new signs of strength in the US economy and expectations that Europe’s central bank will provide more support to the flagging region. AP PHOTO/LEE JIN-MAN
HONG KONG–Asian stocks were broadly higher Wednesday as investors welcomed strong US manufacturing data while Hong Kong tacked on more than two percent following a positive reading on China’s services sector.
The dollar held above the 105 yen mark after breaking it Tuesday for the first time since January, sparking a rally in Japanese exporters.
Tokyo rose 0.38 percent, or 59.75 points, to 15,728.35 while Hong Kong jumped 2.30 percent, or 568.93 points, to 25,317.95 and Shanghai rose 1.00 percent, or 22.58 points, to 2,288.63.
Seoul ended flat, dipping 0.38 points to 2,051.20 and Sydney was also a touch lower, easing 2.4 points to 5,656.10.
Data showed Australian economic growth slowed in the three months to June owing to a sharp fall in exports.
Traders cheered a report from the Institute for Supply Management, which said Tuesday that a gauge of activity in the US manufacturing sector picked up pace in August, hitting its best level since August 2011.
“The parade of solid data continues,” a Societe Generale analyst told Dow Jones Newswires. The figures are the latest suggesting the US economy is well on track to recovery and will add to pressure on the Federal Reserve to raise interest rates earlier than its timetable of next year.
The strong data “should keep upward pressure on the dollar, which will, in turn, make Japan stocks attractive,” said SMBC Nikko Securities general manager of equities Hiroichi Nishi.
But US traders, returning to work Tuesday after the Labor Day weekend, were unimpressed. The Dow fell 0.19 percent and the S&P 500 slipped 0.07 percent although the Nasdaq added 0.39 percent.
Currency dealers shifted into the dollar, helping it breach 105 yen.
In afternoon Tokyo trade the greenback bought 105.06 yen compared with 105.10 yen in New York Tuesday afternoon.
The euro bought $1.3135 and 137.88 yen against $1.3132 and 138.02 yen in US trade.
Eyes on central bank meetings
Buying was also supported by a jump in indexes measuring China’s service sector.
HSBC said its services purchasing managers’ index (PMI) hit a seven-month high of 54.1 last month, while the official PMI climbed for the first time in three months, to 54.4. A figure above 50 indicates growth and anything below points to contraction.
The results helped temper disappointment at Monday’s manufacturing PMIs, which added to concerns about the world’s No. 2 economy.
Focus is now on central bank meetings in Japan and Europe, with a recent batch of soft economic data fanning calls for policymakers at both institutions to ease monetary policy to kickstart growth.
Friday also sees the release of a closely watched US jobs report that could add to growing pressure on the Federal Reserve to increase interest rates.
Oil prices rebounded on bargain-hunting after plunging to multi-month lows in New York trade. US benchmark West Texas Intermediate (WTI) for October delivery rose 38 cents to $93.26 while Brent crude for October gained 42 cents to $100.76 in afternoon trade.
WTI fell $3.08 to $92.88 in New York trade, its lowest level since January, while Brent sank $2.45 in London to $100.34. It had fallen to as low as $100.17, its lowest level since May 2013.
Gold traded at $1,270.61 an ounce at 1120 GMT, from $1,271.33 late Monday.
In other markets:
— Mumbai closed up 120.55 points or 0.45 percent at 27,139.94 points.
Oberoi Realty jumped 15.24 percent to 272.60 rupees, while Jaiprakash Associates lost 3.07 percent to 45.75 rupees.
— Bangkok added 0.94 percent, or 14.67 points, to 1,583.27.
Coal producer Banpu rose 4.55 percent, or 1.50 baht, to 34.50 while Bangkok Bank closed 1.42 percent higher, or 3 baht, at 215.
— Kuala Lumpur’s main index lost 2.82 points, or 0.15 percent, to 1,864.87
Telekom Malaysia shed 0.47 percent to 6.35 ringgit, Tenaga Nasional dipped 0.16 percent to 12.40 while Malayan Banking was flat at 10.14 ringgit
— Jakarta ended up 0.43 percent, or 22.55 points, at 5,224.135.
Hero Supermarket gained 0.20 percent to 2,530 rupiah, while state miner Aneka Tambang fell 0.43 percent to 1,155 rupiah.
— Singapore rose 0.62 percent, or 20.47 points, to 3,348.77.
Oil rig maker Keppel Corp. gained 0.64 percent to Sg$10.98 while DBS Bank rose 0.73 percent to Sg$18.06.
— Taipei rose 0.54 percent, or 50.63 points, to 9,450.35.
Taiwan Semiconductor Manufacturing Co. was up 1.59 percent at Tw$128.0 while Hon Hai Precision Industry added 0.50 percent to Tw$101.0.
— Wellington ended flat, edging up 2.62 points to 5,224.40.
Contact Energy was up 0.37 percent at NZ$5.45 and Spark, formerly known as Telecom, eased 0.99 percent to NZ$2.99.
— Manila rose 1.40 percent, or 99.46 points, to 7,206.02.