Asian shares cheered by Wall Street rally

A man walks past a bank’s electronic board showing the Hong Kong share index outside a local bank in Hong Kong on Thursday, Aug. 27, 2015. China’s main stock market index has surged 5.3 percent, its biggest gain in eight weeks, as Asian markets rose following Wall Street’s overnight rebound.  AP PHOTO/VINCENT YU

HONG KONG–Asian stocks rose on Thursday, with Shanghai leading the gains after a rally on Wall Street cheered investors and eased fears of a deep and lasting global market rout.

Comments from a senior US Federal Reserve official that the case for a rate rise in September had weakened and upbeat durable goods data also boosted sentiment, pushing up the dollar.

Shanghai led the charge, closing up 5.34 percent, or 156.30 points, at 3,083.59, while Hong Kong gained 3.60 percent, or 758.15 points, to close at 21,838.54.

Tokyo stocks closed up 1.08 percent, or 197.61 points, to finish at 18,574.44, while Seoul gained 0.73 percent, or 13.91 points, to 1,908 and Sydney rose 1.17 percent, or 60.53 points, to 5,233.30.

Wall Street finished sharply higher on Wednesday, ending a six-day losing streak after fears for China’s stalling economy wiped some $8 trillion from global share markets.

Asian shares had ended the day mixed after a volatile session that saw Shanghai veer wildly between losses and gains as dealers weighed news that China’s central bank had cut its key rates and moved to free up cash for banks.

Thursday’s rises came after William Dudley, the head of the New York branch of the Fed, said the reasons for a rate hike in September had been dampened by the turmoil gripping financial markets.

Dealers had feared that a rise in US rates—their first in almost a decade—would heap pressure on the world economy at a time when a slowdown in China is already expected to drag on growth.

A better-than-expected official US manufacturing report showing orders for durable goods—products expected to last at least three years—jumped 2 percent in July also added to the optimism.

‘Phenomenal bounce’

“Strong durable goods numbers out of the US and tempting valuations saw a phenomenal bounce in all US equities,” said Angus Nicholson at IG Markets.

“William Dudley’s speech seemingly put to bed any prospect of September rate hikes… I think the market will largely be looking towards December as the most likely date if a rate hike happens this year.”

In currency markets, the dollar gained and dealers sold the ye—seen as a safe haven during times of market turmoil—as risk aversion eased.

In Tokyo trading, the dollar bought 120.21 yen, up from 119.98 yen in New York. This week it touched a six-month low of 116.18 yen.

The euro traded at 135.81 from 135.72 yen, and fetched $1.1296, compared to $1.1312 in US trade.

Gold, also seen as a safe haven when markets are going haywire, gave up gains as sentiment improved to trade at $1,127.40, down from $1,131.80 late Wednesday.

Oil rose in Asia as dealers digested a mixed US energy report showing a dip in crude inventories, but barely any decline in production despite sinking prices.

US benchmark West Texas Intermediate was trading at $39.68, compared to $38.60, while Brent crude was at $44.28, from $43.14.

In other markets:

— Mumbai rose 2.01 percent, or 516.53 points, to 26,231.19.

Housing Development Finance Corporation soared 8.41 percent to 1195.20 rupees but Bharat Heavy Electricals fell 3.54 percent to 231.70 rupees.

— Bangkok rose 2.87 percent, or 37.95 points, to 1,358.03.

Coal producer Banpu gained 3.02 percent to 20.50 baht while Bangkok Bank added 3.08 percent to 167.50 baht.

— Kuala Lumpur rose 1.35 percent, or 21.33 points, to close at 1,601.70.

Telekom Malaysia added 0.31 percent to 6.50 ringgit, Tenaga Nasional gained 1.63 percent to 11.20 while Sime Darby flat at 7.45 ringgit.

— Jakarta ended up 4.55 percent, or 192.90 points, at 4,430.63.

Drugmaker Kalbe Farma gained 7.47 percent to 1,655 rupiah while automotive distributor Tunas Ridean Tbk fell 1.90 percent to 515 rupiah.

— Singapore surged 2.52 percent, or 72.43 points, to close at 2,945.43.

Casino operator Genting Singapore rose 1.33 percent to Sg$0.76 and Oversea-Chinese Banking Corp. advanced 3.15 percent to Sg$9.17.

— Taipei rose 1.41 percent, or 108.96 points, to 7,824.55.

Taiwan Semiconductor Manufacturing Co. added 1.22 percent to Tw$124.0 while Hon Hai Precision Industry closed 1.32 percent higher at Tw$84.6.

— Wellington closed up 1.02 percent, or 57.17 points, at 5,634.95.

Spark rose 3.37 percent to NZ$3.225 and Warehouse Group lifted 0.78 percent to NZ$2.60.

— Manila rose 2.25 percent, or 154.17 points, to 7,022.09.

Top-traded Ayala Land Inc. gained 1.16 percent to 34.80 pesos while BDO Unibank Inc. rose 4.30 percent to 97 pesos.—With a report from Bloomberg News