Asian markets mostly higher on debt crisis hopes

HONG KONG—Asian markets rose Thursday, taking a lead from Wall Street and extending a recent rally on hopes that eurozone leaders will be able to hammer out a solution to the region’s sovereign debt crisis.

Tokyo rose 0.97 percent, or 84.35 points, to 8,823.25, Sydney gained 0.96 percent, or 40.2 points, to 4,244.5 and Seoul ended 0.75 percent, or 13.60 points, higher at 1,823.10.

Hong Kong gained 2.34 percent, or 428.35 points, to 18,757.81. The index has surged more than 15 percent in the past six sessions, after it hit a two-and-a-half-year low.

Shanghai closed 0.78 percent, or 18.79 points, higher at 2,438.79 despite weak export data and with dealers awaiting Friday’s release of inflation data for September.

“Investors are closely watching tomorrow’s CPI (consumer price inflation),” Guan Yewen, an analyst at China Dragon Securities, said.

CPI – the main gauge of inflation – rose 6.2 percent year on year in August, down from a more than three-year high of 6.5 percent in July.

Regional market sentiment was lifted by news that Slovakia’s political parties had agreed to hold a new vote this week that could see the expansion of the eurozone emergency fund approved by Friday.

Lawmakers in the Eastern European nation on Tuesday blocked its passage, holding up EU leaders’ plans to revamp the European Financial Stability Facility (EFSF), a tool created last year to shore up debt-laden economies.

Slovakia is the last of the 17 eurozone members to ratify the deal.

The market appears “a little bit more optimistic that Europe is going to get… together on the banking crisis,” said David Gilmore, analyst at New York’s Foreign Exchange Analytics.

And Mark Smith, economist at ANZ bank in Wellington, told Dow Jones Newswires: “Equity markets are still giving European leaders the benefit of the doubt.”

But he added that in coming days investors will be watching out for concrete measures to resolve the bloc’s debt problems.

European Commission President Jose Manuel Barroso joined the chorus of leaders calling for a solution to the crisis, saying banks “urgently” need to recapitalize to weather the sovereign debt storm.

However, Yutaka Miura, a senior technical analyst at Mizuho Securities, noted: “Markets have been rising solely on the back of expectations (for Europe) so it’s going to be a bit shaky from here.”

Europe’s main stock markets fell at the start of trading on Thursday as investors took profits, with London’s FTSE 100 index of leading shares down 0.58 percent at 5,410.16 points.

Frankfurt’s DAX 30 shed 0.40 percent to 5,994.47 points and in Paris the CAC 40 lost 0.49 percent at 3,212.54 points.

The euro was at $1.3724 against the US dollar, from $1.3796 late Wednesday in New York. It was also at 105.57 yen, from 106.52 yen in New York. On Wednesday in Asia the euro bought 104.46 yen.

The dollar was at 76.92 yen, from 77.24 yen.

In Shanghai dealers sent the composite index higher despite data showing the politically sensitive trade surplus contracted to $14.51 billion in September from $17.8 billion the previous month.

The figures, highlighting falling demand in the United States and Europe, will likely stoke fears over China’s vast manufacturing sector, which employs millions of workers and has been contracting for several months.

On Wall Street, the minutes of the most recent Federal Reserve meeting released Wednesday showed some members wanted the central bank to resume large-scale asset purchases, or quantitative easing, to boost the weak economy.

The news helped send the Dow up 0.90 percent, while the Nasdaq added 0.84 percent and the S&P 500 climbed 0.98 percent.

The Australian dollar got a boost after official data showed the country’s unemployment rate decreased to 5.2 percent in September from 5.3 percent in August.

The Aussie dollar surged to 102.30 US cents from 101.50 just before the report before easing in the afternoon to 101.80.

On oil markets New York’s main contract, light sweet crude for delivery in November, fell 57 cents to $84.14 per barrel in the afternoon.

Brent North Sea crude for November delivery dipped $1.11 to $109.92.

By 1100 GMT gold was at $1,668.60 an ounce, from $1,682.01 at 1100 GMT on Wednesday.

In other markets:

— Taipei rose 0.62 percent, or 45.98 points, to 7,428.33.

Leading smartphone maker HTC gained 2.58 percent to Tw$755.0 after unveiling its first mobile phones using Microsoft’s “Mango” platform while design house MediaTek was 2.13 percent higher at Tw$336.0

— Singapore’s Straits Times Index closed down 3.78 points, or 0.14 percent, to 2,733.97.

DBS Group fell 2.19 percent to 12.06 and Singapore Airlines gained 1.23 percent to 11.28.

— Indian shares fell 0.44 percent or 74.47 points to 16,883.92.

Leading vehicle maker Tata Motors fell 3.09 percent to 175.75 while private aluminium maker Hindalco fell 3.01 percent to 128.85.

— Kuala Lumpur shares rose 1.15 percent, or 16.37 points, to end at 1,444.87.

CIMB Group Holdings gained 1.37 percent to 7.40 ringgit, while AirAsia added 3.38 percent to 3.38. OSK Holdings fell 0.59 percent to 1.68 ringgit.

— Bangkok fell 1.67 percent or 15.95 points, to close at 936.82.

Banpu lost 10 baht to 562, while Siam Cement dropped 6 baht to 287.

— Indonesian shares rose 39.45 points, or 1.09 percent, to 3,675.38.

Car maker Astra jumped 3.0 percent to Rp 67,900, food producer Indofood rose 4.7 percent to Rp 5,550, while Bank Negara soared 2.1 percent to Rp 3,675.

Cigarette maker Gudang Garam fell 3.4 percent to Rp 58,950.

— Manila gained 0.36 percent, or 14.77 points, to 4,134.48.

Philippine Long Distance Telephone Co. was up 1.5 percent to 2,200 pesos while Lepanto Consolidated Mining Co. gained 1.5 percent to 1.35 pesos.

— Wellington closed down 0.55 percent, or 18.44 points, at 3,306.68.

Telecom fell 0.8 percent to NZ$2.53.