Asian markets rose yesterday Tuesday October 16 in response to a strong showing on Wall Street after another round of upbeat data raised hopes for the US economy.
Markets were also lifted by better-than-expected US corporate earnings, said Kenichi Hirano, analyst at Tachibana Securities.
But dealers also remained hesitant before the release this week of Chinese third-quarter growth figures, as evidence accumulates of a slowdown in the world’s second-biggest economy.
Tokyo stocks closed higher, tracking gains on Wall Street and as shares in Softbank surged 10 per cent after it confirmed a US$20 billion takeover of US-based Sprint Nextel.
The benchmark Nikkei 225 Index closed up 1.44 per cent, or 123.38 points, to 8,701.31, while the broader Topix index of all first-section shares rose 1.30 per cent, or 9.41 points, to 732.40.
Chinese shares ended flat, with earlier gains pared as nervousness set in ahead of the corporate earnings season. The benchmark Shanghai Composite Index edged up 0.11 points to 2,098.81.
“The third quarter will probably be the worst this year with less than half of companies profitable,” Hongyuan Securities analyst Tang Yonggang told Dow Jones Newswires.
Sydney gained 0.18 per cent, or 8.1 points, to 4,491.5 and Seoul climbed 0.83 per cent, or 15.95 points, to 1,941.54.
In New York on Monday, the Dow average gained 0.72 per cent, its biggest jump in more than a month.
HONG KONG: SHARES closed at a five-month high yesterday, following a rally on Wall Street after key US retail sales rose more than expected last month.
The benchmark Hang Seng Index ended up 58.82 points, or 0.28 per cent, at 21,207.07 – its highest since May 3 – with chart resistance next seen at about 21,385, the intra-day high on May 2.
“Investors are sticking with sectors that they have reason to be more certain about. This rotation suggests they are also positioning themselves for the next leg up,” Edward Huang, an equity strategist with Haitong International Securities.
SINGAPORE: SOUTHEAST Asian stock markets ended mostly higher yesterday as steadier global stock markets bolstered bargain hunting in recently battered blue chips.
Investors preferred blue chips that are due to release good earnings in the coming reporting season, brokers said.
In Singapore, the benchmark Straits Times Index closed up 0.12 per cent, or 3.76 points, at 3,046.81.
Among the active stocks, Jardine Cycle and Carriage edged down 0.06 per cent to S$50.27 but Keppel Corp gained 0.27 per cent to S$11.25.
KUALA LUMPUR: SHARE prices on Bursa Malaysia ended mixed on lack of catalysts with last-minute selling pushing the key index into the negative territory, a dealer said.
At the close, the FTSE Bursa Malaysia KLCI (FBM KLCI) was almost flat, down 0.92 point to 1,653.52, after being confined within the narrow range of between 1,658.5 and 1,652.08.
The Plantation Index lost 15.1 points to 8,170.54 and the FBM Mid 70 Index decreased 16.99 points to 12,142.69.
The Finance Index jumped 30.93 points to 14,713.39, the Industrial Index rose 5.93 points to 2,859.75 and the FBM ACE advanced 40.26 points to 4,233.46.
The FBM Emas Index declined 8.86 points to 11,234.96.
Gainers outnumbered losers 337 to 334 while 352 counters were unchanged, 619 untraded and 25 other were suspended.
Turnover decreased to 975.1 million shares, valued at RM1.26 billion, from 1.002 billion shares, valued at RM981.60 million, recorded on Monday.
Among heavyweights, Maybank rose 14 sen to RM9.08, Petronas Chemicals perked two sen to RM6.51, Sime Darby declined four sen to RM9.75, CIMB lost 11 sen to RM7.55 and Axiata shed three sen to RM6.47.
Meanwhile, FBM KLCI futures contracts on Bursa Malaysia Derivatives closed lower in line with the easier cash market, dealers said.
October and December lost four points each to 1,653 and 1,653.5 respectively while November and March 2013 slipped 3.5 points each to 1,654 and 1,649.5 respectively.
Turnover was down to 2,612 lots from 3,630 lots on Monday and open interest fell to 31,869 contracts from 32,577 contracts previously.
In other Asian markets yesterday:
* Taipei rose 0.70 per cent, or 52.12 points, to 7,471.02.
* Manila ended 0.31 per cent higher, adding 16.72 points to 5,399.94.
* Jakarta added 0.36 per cent, or 15.55 points, to 4,329.08.
* Bangkok eased 0.24 per cent, or 3.07 points, to 1,287.49.
* Mumbai fell 0.73 per cent, or 135.85 points, to 18,577.70.
VIETNAM: Vietnamese shares rose first time in 4 days as local investors uploaded shares on improving sentiment, property and securities shares led the market rally.
The benchmark VN Index gained 7.66 points or 1.96% to 399.22. Volume rose 14.3% to 41.18 million shares worth of VND555.2 billion.
Put through trading contributed 2.6 million shares worth of VND66.35 billion.
Today’s market breadth turned broadly positive on the primary bourse where 191 stocks advanced, 44 declined, 43 closed unchanged.
The VN30 added 10.34 points or 2.24%, to 471.68 . Among its 30 members 29 gained, 0 lost the ground and 1 unchanged.
On the Hanoi Stock Exchange, the HNX rose 1.34 points or 2.44% to 56.28.
Trading volume rose 53% to 38 million shares worth VND263.9 billion.
The market breadth turned positive where 188 rallied, 48 declined, 46 closed unmoved, the rest untraded.
The HNX30 surged 4.5 points or 4.4% to 106.81. Of its 30 members, 29 gained, 0 unchanged, 1 lost.
EUROPE: European shares extended their earlier gains by mid-day yesterday, with traders citing a media report that Germany may be prepared to soften its stance over helping Spain ahead of any official bailout.
The FTSEurofirst 300 index was up by 0.9 per cent at 1,107.69 points by 1155 GMT, while Spain’s benchmark IBEX equity index was up by 1.9 per cent.
“Markets are far from flying, but it does now seem as if the outlook is a little brighter than it was a week ago,” said Fawad Razaqzada, market strategist at GFT Markets.
Earlier, at around 1045 GMT, Britain’s FTSE 100 was up 0.5 per cent at 5,836 while Germany’s DAX rose 0.7 per cent to 7,308. The CAC-40 in Paris was 0.5 per cent higher at 3,436.
AMERICA: Inflation is low, earnings are high, investors are happy.
Stocks shot higher Tuesday, giving the market its biggest gain in a month. Results at Mattel, Goldman Sachs, and Johnson & Johnson were all above expectations.
It was the second day of broad gains following a down week last week. Investors had been worried headed into the third-quarter earnings season that corporate profits wouldn’t be good enough to justify the run-up in stocks in recent months. While earnings haven’t been out-of-the-park great, they haven’t been as bad as some had feared.
Also Tuesday, the Labor Department said consumer prices rose just 0.1 percent last month, not counting food and energy costs. And gasoline prices have come down since then. Low inflation leaves consumers with more money to spend, and leaves the Federal Reserve free to continue its efforts to boost the economy.
In addition, an index of homebuilder sentiment came in at its highest level since 2006, suggesting that the construction industry is making a comeback.
“The picture of the economy is one that’s still proving to be resilient to a lot of the problems that investors are worried about,” said Gary Thayer, chief macro strategist for Wells Fargo Advisors.
The Dow Jones industrial average rose 127.55 points to close at 13,551.78, its biggest gain since Sept. 13.
The Standard & Poor’s 500 index rose 14.79 points to 1,454.92, and the Nasdaq composite rose 36.99 to 3,101.17.
The gains were broad, with nine out of 10 industry groups in the S&P 500 index rising. Telecom stocks had a tiny decline. Materials stocks rose 2.4 percent.
Mattel jumped 5 percent after reporting that brisk sales of American Girl dolls and Fisher-Price toys sent the company’s profit well above analysts’ forecasts. The stock gained $1.78 to $37.20.
Johnson & Johnson rose 95 cents to $69.55 after revenues came in ahead of Wall Street’s forecasts.
Among companies reporting after the closing bell, IBM fell in after-hours trading after its revenues came up short of Wall Street’s forecasts. Intel fell after its earnings and revenue came in below forecasts.
Other stocks making big moves included:
Apple rose $15.03, or 2.4 percent, to $649.79 after the company sent out invitations for an event next Tuesday where it is expected to announce a smaller iPad.
Citigroup rose 59 cents $37.25 following the sudden departure of CEO Vikram Pandit, who had steered the bank through the 2008 financial crisis. Pandit, who is also stepping down from the company’s board, is being replaced by longtime Citi executive Michael Corbat.
A123 Systems Inc., a maker of electric batteries for vehicles, put its U.S. operations into Chapter 11 bankruptcy protection and said its automotive assets will be acquired by Johnson Controls for $125 million. A123′s stock plunged 18 cents to 6 cents.
The yield on the benchmark 10-year Treasury note rose to 1.72 percent from 1.67 percent late Monday.
European markets also rose. Benchmark indexes were up 1.6 percent in Germany, 2.4 percent in France and 1.1 percent in Britain.
The euro rose to almost $1.30 against the dollar from $1.29 the day before.
Benchmark Currency Rates