Asian markets swung higher

Sydney, Sensex, Seoul, Hang Seng, Taiex finish higher while Shanghai gave up gains

Stock market in Asian region swept to their highest levels for 2009 on Wednesday, 16 September 2009, after upbeat US economic news boosted riskier assets leveraged to global growth, while the US dollar slipped to a one-year low. Most major Asian stock indexes posted gains of 1% or more in the wake of Tuesday's strong reading on US retail sales, with exporting countries leading the way.

On Wall Street, the major stock averages closed at new highs for the year, boosted by comments from Fed Chairman Ben Bernanke and data that showed greater-than-expected increases in sales and manufacturing. The S&P 500 advanced 3.29, or 0.3%, to 1052.63, and the Nasdaq Composite advanced 10.86 points, or 0.5%, to 2102.64 -- both new highs for the year. The Dow Jones Industrial Average added 56.61 points, or 0.6%, to 9683.41, its highest close since October 6, 2008.

On the economic front, the Department of Commerce said retail sales increased 2.3% in August, after a 0.2% declines the month prior. When autos were factored out, sales increased 1.1%, well above expectations for an 0.4% increase.

In the commodity market, crude oil fell after an industry report showed an increase in distillate and crude stockpiles in the U.S., the world’s biggest energy consumer.

Crude oil for October delivery was at $70.60 a barrel, down 33 cents, in electronic trading on the New York Mercantile Exchange as of 9:55 a.m. London time. The contract earlier fell 1.1%. Yesterday, the contract rose $2.07 to settle at $70.93, the biggest increase since 8 September 2009.

Brent crude oil for November settlement on the London-based ICE Futures Europe exchange was at $69.55 a barrel, down 31 cents, at 9:05 a.m. London time. The October contract expired yesterday at $67.35 a barrel, down 9 cents.

Gold climbed to an 18-month high in London on concern that a global economic recovery may stoke inflation and on a drop by the dollar that boosted demand for the metal as an alternative investment. Immediate-delivery bullion advanced as much as $10.60, or 1.1%, to $1,018.15 an ounce and traded at $1,014.88 by 9:45 a.m. London time. December gold futures were 1% higher at $1,016.40 an ounce on the New York Mercantile Exchange’s Comex division.

In the currency market, US dollar weakness resumes and made a new low against basket of currencies on the back of rally resumption in US stocks and Gold.

The Japanese yen softened against major currencies. The Japanese yen was quoted at 91 against the US dollar and 133.35 against euro

The Hong Kong dollar was trading at HK$ 7.7499 against the dollar. Actually The Hong Kong dollar is pegged at HK$ 7.8 to the U.S. dollar but can trade between HK$ 7.75 and HK$7.85 to the U.S. dollar.

In Sydney trade, the Australian dollar advanced to near 1-year highs against a weak US dollar on Wednesday as a recent shift towards riskier assets like high-yielding currencies and stocks gathered pace. At the local close, Aussie was at $US0.8669, not far from a one-year high of $US0.8677, though it faces strong resistance around $US0.8720. Yesterday it closed at $US0.8609.

In Wellington trade, The New Zealand dollar firmed against major currencies overnight as gains in global stock markets improved investors' appetite for risk. By 5pm today the NZ dollar was buying US71.22c from US70.14c at 5pm yesterday.

The South Korean won ended at 1,211.2 won to the U.S. dollar, up 7.2 won from Tuesday's close. The unit jumped to the strongest level for this year after bullish stock markets boosted foreign investors' demand and a global downtrend of the dollar raised the value of the won.

The Taiwan dollar strengthened against the greenback. The Taiwan dollar was trading higher against the US dollar at NT$ 32.5290, 0.1080 up from Tuesday’s close of NT$32.6370.

In the Asian equities, indices in Hong Kong, Australia, South Korea and Taiwan ended at their highest levels of 2009, reflecting buoyant investor sentiment in the region and tracking a similar upbeat performance on Wall Street.

In Japan, shares market finished the session in diverse note; after opening higher buoyed by exporters following the robust US monthly retail sales and manufacturing reports rekindled hopes of a speedy economic recovery. But most of morning gains were pared in the late trading, with decline in Banks and financials as investors banked profit amid concern recent rally was overdone and ahead of new government formation of Japan new government later in the day.

At the closing bell, the Nikkei 225 Stock Average index added 53.15 points, or 052%, to 10,270.77, while the broader Topix stumbled 1.09 points, or 0.12%, to 931.43.

In Mainland China, share market tumbled snapping three days of winning streak, weighed down by market heavyweights. Financials drag the most amid worries over uncertainties on the government’s monetary measures later this year. Energy and industrial sector tumbled amid worries recent rally was overdone. The Shanghai Composite Index, measuring A shares and B shares on the Shanghai Stock Exchange, stumbled 34.02 points, or 1.12% to 2,999.71, while the CSI 300 Index, measuring exchanges in Shanghai and Shenzhen, tumbled 1.34%, to 3,258.24.

In Hong Kong, the stock market snapped two days of loosing streak, with all the sectoral indices contributed to the rally as robust US monthly retail sales and manufacturing report rekindled hopes the global economy in on track. Financials and properties led the rally as strong economic data in the United States reinforced hopes of turnaround in the global economy. Exporters gained ground following the robust US monthly retail sales figures.

The Hang Seng Index spurted 536.55 points, or 2.57%, to 21,402.92, while the Hang Seng China Enterprise surged 369.65 points, or 3.04%, to 12,525.72.

In Australia, the shares market surged, with benchmark indices hit fresh eleven month high on the back of solid gains across the board, buoyed by positive global cues and firmer commodities prices. Telstra shares led the rally on bottom fishing following yesterday sell off after the Government’s plan to split the company.

At the closing bell, the benchmark S&P/ASX200 index surged 110.10 points, or 2.42%, to 4,650.40, meanwhile the broader All Ordinaries added 105.6 points, or 2.32%, to 4,652.8.

On the economic front, the Westpac–Melbourne Institute Leading Index indicated the pace of economic activity in the next three to nine months was continuing to improve. Although the July index was minus 1.8%, below the long-term trend of 2.5%, it has improved from minus 7% as recently as May.

In New Zealand, stock market ended the day in the positive terrain although the gains were mild although most of the Asian bourses registered strong gains. Moat of the Asian markets were trailing gains on the Wall Street overnight, however, Shanghai-listed stocks plowed lower in morning trade, with some of the exchange's largest stocks moving down on likely profit-taking. The NZX50 gained 0.58% or 17.96 points to 3117.58. The NZX 15 increased 0.40% or 22.94 points to close at 5705.66.

In South Korea, stocks closed higher, underpinned by bullish trading on Wall Street and solid institutional buying. The benchmark Korea Composite Stock Price Index (KOSPI) soared 29.93 points to end at 1,683.33, setting a new high for the year.

In Singapore, stock market surged led by banks and major blue chips stocks on rekindled hopes of a speedy economic recovery after a positive economic data out of the US. Shares of property developers swelled, following two days of losses triggered by the government’s plan to prevent excessive price swings in the housing market. Manufacturing and multi industries gained the ground, climbing along with metal and crude oil prices. The blue chip Straits Times Index was ended at 2,674.42, gained 36.02 points, or 1.37%.

In Taiwan, stock market pull in some gains, finishing at highest close in more than 14 months, as positive retail sales data from the United States boosted buying in technology shares. The benchmark Taiex share index consolidated gains as it finished the session higher by 93.98 points or 1.28% in a day, closing the day at 7440.24, achieving a new fourteen and half month high status by showing the closing not seen from 30 June 2008 when market closed at 7523.54.

On the economic front, about 23,303 new cars were sold in Taiwan in August, a 143.7% year-on-year (YoY) increase and over 20,000-vehicle volume for the third consecutive month to signal recovery in the market.

According to the Ministry of Transportation and Communications (MOTC), all the top-seven automakers enjoyed high year on year sales increase last month, including Hotai Motor Company that enjoyed an amazing 349.7% sales increase from that last year. In August, Hotai sold 10,128 vehicles, accounting for 43.5% of the overall market, compared to 2,438 vehicles sold by No. 2 China Motor Corporation (CMC), who reported a 120.8% year on year shipment increase in the month for a 14.1% share.

In Philippines, a continued wave of sell off from a 14 month high pushed the Philippines stocks lower despite the cues from the global markets turning positive. The market participants ignored the positive array of economic data as well and made the local markets give away the early gains to close in red. The benchmark PSEi ended down more than a percent in intraday moves as the broad area around 2880-90 fatigued the investors and lack of buying in a highly overbought market weighed higher in stocks belonging to services and industrial sectors. At the final bell, the benchmark index PSEi lost 0.74% or 20.75 points to 2,768.61, while the All Shares index tumbled 0.33% or 5.94 points to 1,778.78.

In India, the key benchmark indices surged to their highest level in nearly 16-months in late trade tracking firm global stocks. The sentiment was upbeat as preliminary data showing a strong growth in advance tax payment by India Inc raised expectations of decent-to-strong Q2 September 2009 results. Comments by the Reserve Bank of India governor that the central bank won't hike interest rates until economic recovery is firmly on track also supported stocks.

The BSE 30-share Sensex was up 222.59 points or 1.35% to 16,677.04. The Sensex rose 246.11 points the day's high of 16,700.56 in late trade, it’s highest since 23 May 2008. The barometer index rose 44.14 points at the day's low of 16,498.59 in early trade. The S&P CNX Nifty was up 66.30 points or 1.36% to 4958.40. It hit a high of 4966.30 in late trade; it’s highest since 23 May 2008.

Elsewhere, Malaysia's Kula Lumpur Composite index went up 0.46% or 5.51 points to 1212.98 while stock markets in Indonesia’s Jakarta Composite index ended the day higher at 2439.36.

In other regional market, European shares rose for the ninth time in ten sessions on Wednesday, with miners and construction firms in the lead, as investors bought up shares in the hope that there will be a sustained recovery in the global economy. On a regional level, the U.K. FTSE 100 index rose 1.46% or 73.47 points to 5,116, the German DAX index climbed 0.87% or 48.84 points to 5,678 and the French CAC-40 index climbed 1.38% or 51.62 point to 3,804.