Asian shares edge higher ahead of US Fed chief’s speech

Pedestrians are reflected on an electronic stock board of a securities firm in Tokyo, Tuesday, Aug. 19, 2014. Asian shares mostly edged higher Wednesday, Aug. 20, following a positive lead from Wall Street, where stocks advanced on encouraging US economic data before a keynote speech this week by the Federal Reserve chief. AP

HONG KONG—Asian shares mostly edged higher Wednesday following a positive lead from Wall Street, where stocks advanced on encouraging US economic data before a keynote speech this week by the Federal Reserve chief.

The dollar hit multi-month highs against the euro and yen after a surge in US housing construction boosted optimism over the state of the world’s top economy.

Tokyo ended flat, edging up 4.66 points to 15,454.45 after data showed a rebound in exports helped narrow Japan’s trade deficit in July. But the shortfall still came in worse than expected after a marked slowdown in the world’s No. 3 economy.

Seoul also ended flat, inching up 1.64 points to 2,072.78 but Shanghai slid 0.23 percent, or 5.12 points, to 2,240.21.

Hong Kong held on to its gains a day after hitting a six-year high, closing up 0.15 percent, or 36.81 points, at 25,159.76.

Sydney rose 0.19 percent, or 10.8 points, to 5,634.6, but BHP Billiton’s shares slumped almost four percent as investors fled over the lack of a stock buyback and the global mining giant’s demerger plans announced a day earlier.

The incremental gains in Asian markets followed a positive lead from Wall Street, where the Dow Jones Industrial Average finished up 0.48 percent at 16,919.59 on Tuesday after new upbeat US data.

Housing starts in the world’s biggest economy jumped 15.7 percent in July to their strongest level since last November, while new building permits rose 8.1 percent.

Dollar rally

The figures raise expectations of an earlier than expected US interest rate rise, which tends to boost the dollar.

In late afternoon Asian trade, the greenback rose to 103.23 yen at one stage, its strongest level in four months, and well up from 102.91 in New York.

The dollar rally also came ahead of Wednesday’s release of minutes from the policy-setting Federal Open Market Committee’s last meeting.

Analysts will pore over the minutes for signs of whether the Fed might accelerate the timeline for raising rates, now expected in the second half of 2015.

Traders were looking ahead to a speech on Friday by Federal Reserve chief Janet Yellen for any hint of a change to the US central bank’s interest rate plans.

Last month Yellen said the Fed would hold its near-zero interest rate policy until the US economy strengthened, but may raise rates if the jobs market continues to improve.

The euro weakened to nine-month low of $1.3303 from $1.3321 in US trade, while it strengthened to 137.29 yen against 137.07 yen.

On oil markets, US benchmark West Texas Intermediate for September delivery rose 81 cents to $95.29. Brent crude for October eased 12 cents to $101.44 in afternoon trade.

Gold traded at $1,294.76 an ounce at 1200 GMT compared to $1,300.30 an ounce late Tuesday.

In other markets:

— Wellington rose 0.51 percent, or 26.13 points, to 5,140.34.

Fletcher Building added 0.88 percent to NZ$9.17 after a modest full-year result and Chorus was up 0.29 percent at NZ$1.745.

— Taipei gained 0.48 percent, or 44.27 points, to 9,288.05.

TSMC rose 1.21 percent to Tw$125.5 while Acer fell 1.99 percent to Tw$24.65.

— Manila climbed 0.19 percent, or 13.74 points, to 7,096.49.

Top-traded Philippine Long Distance Telephone rose 1.60 percent to 3,302.00 pesos, Energy Development Corp. jumped 4.44 percent to 7.05 pesos, and Ayala Land inched up 0.60 percent to 33.35 pesos.

— Mumbai fell 0.40 percent, or 106.38 points, to 26,314.29.

Dena Bank lost 5.06 percent to 60.10 rupees, while Bhushan Steel fell 4.97 percent to 137.70 rupees.

— Bangkok added 0.51 percent, or 7.92 points, to 1,550.77.

Telecoms companies were in the vanguard, with Total Access Communication soaring 6.70 percent to 111.50 baht and True Corp. gaining 6.80 percent to 11 baht.

— Kuala Lumpur rose 6.73 points, or 0.36 percent, to 1,878.89.

Malaysia Airlines rose 2.0 percent to 0.26 ringgit, while SapuraKencana Petroleum added 0.2 percent to 4.13. Budget carrier AirAsia fell 0.4 percent to 2.38 ringgit.

— Jakarta ended up 0.48 percent, or 25 points, at 5,190.17.

Food manufacturer Indofood Sukses Makmur gained 1.07 percent to 7,075 rupiah, while palm oil firm Wilmar Cahaya Indonesia slipped 1.36 percent to 1,810 rupiah.

— Singapore rose 0.22 percent, or 7.22 points, to 3,323.65.

DBS Bank gained 0.40 percent to Sg$17.75 while vehicle distributor Jardine Cycle & Carriage advanced 0.09 percent to Sg$45.18.