Asia shares boosted by China PMI data

Pedestrians are reflected on the electronic stock indicator of a securities firm in Tokyo on Thursday, May 22, 2014. Asian shares mostly rose Thursday as data indicated an improvement in Chinese manufacturing activity and minutes from the US Federal Reserve showed officials are considering their policy options after the bank’s stimulus program ends. AP PHOTO/SHIZUO KAMBAYASHI

HONG KONG—Asian shares mostly rose Thursday as data indicated an improvement in Chinese manufacturing activity and minutes from the US Federal Reserve showed officials are considering their policy options after the bank’s stimulus program ends.

Wall Street provided a healthy lead, with all three main indexes well up, while the dollar added to its gains in New York as traders become more confident in higher-yielding, riskier assets.

Tokyo rallied 2.11 percent, or 295.62 points, to 14,337.79, Sydney jumped 1.02 percent, or 55.33 points, to 5479.9 and Seoul gained 0.36 percent, or 7.26 points, to 2,015.59.

Hong Kong rose 0.51 percent, or 117.24 points, to 22,953.76 but Shanghai closed 0.18 percent lower, giving up 0.18 percent, or 3.66 points, to end at 2,021.29.

HSBC said preliminary data from its purchasing managers index (PMI) showed activity in China’s factories declining at a much slower pace in May than in April.

The banking giant’s PMI improved to 49.7 from 48.1 last month.

While the figure is below the 50-mark—suggesting contraction—it is the second straight month of improvement and will fuel hopes that the world’s No. 2 economy is picking up.

“The improvement was broad-based with both new orders and new export orders back in expansionary territory,” Qu Hongbin, HSBC’s Hong Kong-based economist, said in the statement.

“Some tentative signs of stabilization are emerging, partly as a result of the recent mini-stimulus measures and lower borrowing costs.”

But he added that “downside risks to growth remain, particularly as the property market continues to cool.”

In the United States, minutes from the Fed’s April committee meeting showed policymakers are discussing how to manage the impact of an interest rate hike they expect to implement in the middle of next year.

Fed weighs interest rate options

Their talks come as the bank winds down its massive stimulus program amid growing signs that the US economy is getting back on track after the financial crisis.

“The committee’s discussion of this topic was undertaken as part of prudent planning and did not imply that normalization would necessarily begin sometime soon,” the minutes said.

“Because the Federal Reserve has not previously tightened the stance of policy while holding a large balance sheet, most participants judged that the committee should consider a range of options and be prepared to adjust the mix of its policy tools as warranted.”

US rates have been at a record low since December 2008, part of the bank’s unprecedented loose monetary policy aimed at helping the economy recover from the global recession.

On Wall Street the Dow rallied 0.97 percent, the S&P 500 jumped 0.81 percent and the Nasdaq rose 0.85 percent.

And in currency trade the greenback bought 101.60 yen in the afternoon, up from 101.38 yen late in New York and much higher than the 101.17 yen in Tokyo earlier Wednesday.

The euro bought $1.3678 and 138.92 yen against $1.3686 and 138.76 yen in US trade.

Oil prices dropped after rallying late Wednesday on news that US stockpiles had plummeted, lifting hopes that demand is picking up.

US benchmark West Texas Intermediate for delivery in July eased seven cents to $104.00 in afternoon trade, after jumping $1.74 to close at a one-month high Wednesday.

Brent North Sea crude for July was down 13 cents at $110.41. The contract gained 86 cents in London, touching a level last seen in early March.

Gold fetched $1,296.27 an ounce at 1050 GMT compared with $1,292.14 late Wednesday.

In other markets:

— Bangkok closed up 0.16 percent, or 2.29 points, to close 1,405.21

Coal producer Banpu lost 2.50 percent, or 0.75 baht, and energy giant PTT Plc dropped 0.65 percent, or 2 baht, to 308 baht.

— Jakarta ended up 1.21 percent, or 59.59 points, at 4,969.88.

State miner Aneka Tambang gained 5.04 percent to 1,250 rupiah, while cement maker Semen Indonesia fell 0.17 percent to 14,950 rupiah.

— Kuala Lumpur’s main stock index lost 1.91 points, or 0.10 percent, to close at 1,875.12.

Plantation giant Sime Darby fell 0.1 percent to 9.64 ringgit, while utility Tenaga Nasional shed 0.2 percent to 12.18. Budget carrier AirAsia gained 4.5 percent to 2.56 ringgit.

— Singapore rose 0.12 percent, or 3.88 points, to close at 3,265.66.

Property developer CapitaLand was up 1.27 percent to Sg$3.18 and Singapore Airlines dipped 0.19 percent to Sg$10.28.

— Mumbai’s benchmark index rose 0.31 percent, or 76.38 points, to 24,374.00 points.

Shares of the scandal tainted Multi-Commodity Exchage of India, which is listed on BSE, rose 19.91 percent to 586.40 rupees while Suzlon Energy surged 14.88 percent to 21.93 rupees.

— Taipei climbed 1.21 percent, or 107.21 points, to 8,969.63.

Taiwan Semiconductor Manufacturing Co. rose 1.24 percent to Tw$122.0 while smartphone maker HTC was 0.62 percent higher at Tw$163.5.

— Wellington rose 0.40 percent, or 20.27 points, to 5,108.57.

Air New Zealand was 1.64 percent higher at NZ$2.17 and Contact Energy added 0.18 percent to N$5.46.

— Manila rose 1.01 percent, or 68.20 points, to close at 6,830.56.

Philippine Long Distance Telephone added 0.55 percent to 2,900 and Ayala put on 1.32 percent to 654 pesos.