Asian shares mostly higher on Wall Street rally
HONG KONG—Asian shares were mostly higher Wednesday following another Wall Street rally on positive corporate earnings and upbeat US sentiment, although ongoing European debt woes continue to weigh.
Markets and the euro were given some support by news that ratings agency Fitch was not planning to strip France of its top triple-A rating for 2012, easing persistent concerns over Europe’s fiscal woes.
Tokyo closed up 0.30 percent, or 25.62 points, at 8,447.88 and Sydney added 0.85 percent, or 35.3 points, to close at 4,187.5 while Hong Kong was 0.78 percent higher, adding 147.66 points to end at 19,151.94.
However, Seoul shed 0.41 percent, falling 7.67 points to close at 1,845.55 and Shanghai slipped 0.42 percent, or 9.69 points, to 2,276.05 following two sessions that saw it add more than five percent.
“Within the last seven days we have witnessed economic data which has been supportive of traders branching into risk assets,” Tim Waterer, a senior foreign exchange dealer at CMC Markets, said in a note, according to Dow Jones Newswires.
US aluminium giant Alcoa kicked off the corporate earnings season, saying full-year profit more than doubled in 2011 to $611 million and delivered an upbeat demand outlook, although it also posted a fourth-quarter loss of $191 million on declining revenues.
The news boosted Wall Street, as the Dow rose 0.56 percent to its highest finish since July, while the tech-rich Nasdaq added 0.97 percent and the broader S&P 500 advanced 0.89 percent.
US traders also cheered as China’s trade surplus shrank in 2011, prompting speculation that Beijing will further loosen monetary policy to support growth in the world’s second-biggest economy.
Continuing to buoy sentiment was data earlier this week showing a 9.9 percent surge in US consumer credit in November, the biggest increase in a decade, while credit card spending and loans both rose, adding to hopes the US economy is getting back on track.
Investors also welcomed Fitch Ratings’ comments that it would likely keep France’s top-notch rating for now, providing a little respite to dealers who had feared such a move against one of the eurozone’s key players.
However, the region’s debt crisis was still playing on dealers’ minds as leaders hold fresh talks aimed at addressing the issue, with a European Central Bank (ECB) policy meeting set for Thursday.
Markets were also cautious ahead of debt auctions by struggling Spain and Italy, also starting on Thursday.
“The market’s focus is now shifting to Europe’s debt issue again,” said Lim Dong-Rak, analyst at Hanyang Securities in Seoul.
“Investors are doubtful whether the recent set of encouraging US economic data will continue to improve,” he said.
Despite the upbeat news on France, Fitch warned Tuesday that eurozone countries have to raise two trillion euros ($2.55 trillion) in 2012, with more than half of that accounted for by Spain, Italy, Belgium and Ireland – those most at risk of a downgrade.
Italy was the most worrying of the embattled eurozone countries and could see its credit rating cut this month, the agency said.
Meanwhile, banks’ deposits with the ECB hit a new record high, suggesting tensions in the financial system continue despite unprecedented injections of liquidity.
Banks put 481.9 billion euros on deposit for 24 hours at the ECB overnight Monday, beating the previous day’s record of 463.6 billion euros.
Rising levels of deposits suggest banks are wary of lending to each other, preferring instead to park funds at the ECB, and stoking concerns of a credit crunch.
On currency markets, the euro was at $1.2774 and 98.25 yen in early European trade from $1.2775 and 98.15 yen in New York late Tuesday. The single currency fell to a new 16-month low of $1.2666 in New York on Monday.
The dollar was changing hands at 76.91 yen against 76.80 yen.
New York’s main oil contract, West Texas Intermediate crude for delivery in February, was up 23 cents at $102.47 in the afternoon.
Brent North Sea crude for February gained 36 cents to $113.64.
Gold was at $1,640.00 an ounce at 1055 GMT, against $1,627.90 late Tuesday.
In other markets:
— Singapore climbed 1.00 percent, or 27.30 points, to 2,747.13.
Real estate developer Capitaland gained 1.28 percent to Sg$2.38 and DBS Bank was up 2.19 percent at Sg$12.14.
— Taipei ended 0.13 percent higher, climbing 9.34 points to 7,188.21
Leading integrated circuit design house MediaTek was 1.67 percent higher at Tw$274.5 while smartphone maker HTC added 2.34 percent to Tw$460.0.
— Manila closed 1.86 percent, or 84.78 points, higher at 4,645.86, another record high for the index.
Philippine Long Distance Telephone rose 4.4 percent to 2,818 pesos, while Ayala Land added 4.1 percent to 17.08 pesos.
— Wellington gained 0.26 percent, or 8.52 points, to 3,236.53.
Air New Zealand jumped 1.14 percent to NZ$0.89, Fletcher Building added 1.03 percent to NZ$5.86 and Telecom was 1.48 percent off at NZ$2.00.
— Jakarta fell 0.74 percent, giving up 29.20 points to close at 3,909.64.
Car maker Astra International declined 1.8 percent to 75,600 rupiah and cement maker Indocement Tunggal Prakarsa fell four percent to 17,750 rupiah.
— Kuala Lumpur ended flat, edging up 0.30 points to 1,522.29.
UEM Land Holdings inched up 0.43 percent to 2.31 ringgit, while utility Tenaga Nasional gained 1.48 percent to 6.16 ringgit. Telecoms group Axiata fell 1.40 percent to 4.92 ringgit.
— Bangkok gave up 0.13 percent, or 1.41 points, to close at 1,051.63.
— Mumbai was flat, nudging up 10.77 points to 16,175.86.
Pantaloon Retail, part of the Future Group that also runs Big Bazaar supermarkets, rose 4.06 percent to 152.55 rupees while retailer Shoppers Stop jumped 4.85 percent to 303.4 rupees.
Aluminium producer Hindalco rose 5.69 percent to 130 rupees.
