Asian markets extend gains

Nikkei, Sydney led regional rally while Hang Seng, Sensex, Seoul follows them

Stock markets in Asian region extended their gain for sixth session on Wednesday, 17 February 2010, on speculation the global economy is recovering as commodity prices gained, US manufacturing expanded faster than estimated and Barclays more than doubled profit. The key benchmark indices in Hong Kong, Indonesia, Japan, South Korea and Singapore rose by 0.59% - 1.65%. Stock markets in China and Taiwan were closed for the Lunar New Year holidays.

On Wall Street, the Dow rallied to a triple-digit gain Tuesday as strong earnings and economic data, coupled with the Euro’s gains against the dollar, helped an array of equities and commodity prices. The Dow Jones Industrial Average finished higher by 170 points, or 1.7%, to 10,269. The S&P 500 gained 19 points, or 1.8%, to 1095, and the Nasdaq advanced by 31 points, or 1.4%, to 2214.

In the commodity market, crude oil was little changed above $77 a barrel in New York after rising as the dollar fell against the euro on speculation Greece won’t need a European Union bailout to meet deficit-reduction targets.

There was no floor trading in New York on 15 February 2010 because of the Presidents Day holiday. Electronic trades that day and yesterday’s session counted toward the settlement.

Prices also gained after manufacturing in the New York region grew at the fastest pace in four months. The Federal Reserve Bank of New York’s general economic index rose to 24.9 this month, higher than anticipated, from 15.9 in January

Crude oil for March delivery traded at $77.07 a barrel, up 6 cents, in electronic trading on the New York Mercantile Exchange at 3:13 p.m. Singapore time. Yesterday, the contract rose $2.88, or 3.9%, to $77.01, the biggest percentage gain since 30 September 2009.

Brent crude for April delivery traded at $75.70 a barrel, up 2 cents, on the London-based ICE Futures Europe exchange at 3:14 p.m. in Singapore. Yesterday, the contract increased $3.17, or 4.4%, to $75.68.

Gold, little changed, may extend its gain to the highest almost a month as the dollar weakens, boosting demand for the precious metal. Gold for immediate delivery was at $1,118.43 an ounce at 2:50 p.m. in Singapore after trading between $1,115.95 and $1,120.90. Bullion yesterday rose 1.7% to $1,119.45 an ounce, the highest closing price since 19 January 2010.

In the currency market, the Japanese yen was softened against major currencies on Wednesday. Japanese yen softened against euro as concerns over Greece's deficit problem recede after EU finance minister meeting overnight, easing demand for downside hedges. The Japan’s currency yen was quoted at 90.35 against the greenback.

The Hong Kong dollar was trading at HK$ 7.7688 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 trades, the Australian dollar held fort at three-week highs above $US0.9000 on Wednesday, aided by a perkier mood in markets, expectations of more rate rises at home and a pause in the Euro’s recent slide. At the local close, the dollar was trading at $US0.9012, up from $US0.8934 on Tuesday. Most of the gains were made offshore when a weaker US dollar, higher US stocks and commodity prices helped at the margins.

In Wellington trades, the New Zealand dollar drifted lower during its domestic session after gaining nearly a cent overnight as investors regained their risk appetite amid an apparently stabilising situation in Greece and general market optimism. The NZ dollar drifted to US70.45c at 5pm after reaching US70.80c in early trading from US69.90c at 5pm yesterday.

The South Korean won ended at 1442.20 won to the U.S. dollar, up 9.3 won from Tuesday’s close of 1,151.5.

In equities, Asian markets rallied with resource shares rising sharply on higher commodity prices, while a weaker yen boosted Japanese exporters.

In Japan, the key stock average registered gains as positive cues from global shores installed confidence in the economic outlook. Strong domestic and overseas earnings and economic data, coupled with the softer yen versus euro and US dollar and stronger commodities, helped an array of equities and commodity shares. Gains were also fueled by fresh round of buying activities in stock index futures during afternoon session.

At the settlement, the Nikkei 225 Stock Average index was at 10,306.83, spurted 272.58 points, or 2.72%. The broader Topix of all First Section issues on the Tokyo Stock Exchange surged 19.46 points, or 2.2%, to 904.63.

In economic section, the Ministry of Economy, Trade and Industry said an index measuring the activity of tertiary industries in Japan declined by a seasonally adjusted 0.9% in December to standing at 95.8 following the revised 0.1% contraction in November.

In Hong Kong, the shares spurted on the first trading day of the year of the Tiger, as the market played catch-up following the Lunar New Year holiday for two days. The gains was bolstered by strong cues from international market and surging metal prices in London which offset Beijing’s decision to increase bank reserve requirements ratio by 50 basis points for the second time this year.

At the close, the Hang Seng Index surged 265.32 points, or 1.31%, to 20,534.01, meanwhile the Hang Seng China Enterprise, which tracks the overall performance of 43 Mainland Chinese state-owned enterprises on the Hong Kong Stock Exchange, spurted 171.98 points, or 1.49%, to 11,708.34.

In Australia, the shares extended gains throughout the session, with key All Ordinaries index registered rise at settlement, thanks to positive European market and Wall Street overnight, stronger commodities prices, and generally upbeat earning updates. Investors confidence over the economy was strengthen by strong earning reports, with around 75% of Australian company’s ahead estimates.

At the settlement, the benchmark S&P/ASX200 index climbed up 100.10 points, or 2.19%, to 4,667.90, meanwhile the broader All Ordinaries has gained 96.0 points, or 2.09%, to 4,686.80.

In economic section, the Department of Employment and Workforce Relations said Wednesday an index measuring skilled job vacancies in Australia added 1.6% to standing at 44.4 in February compared to the previous month. The latest Westpac-Melbourne Institute Leading Index rose by 1.3 points, or 0.5%, in December to 245.8.

In New Zealand, stock market continued to move forward with the benchmark index rising in the positive terrain for the second day in a row. The NZX 50 advanced by 0.75% or 23.45 points to 3111.06. Meanwhile, the NZX 15 increased 0.92% or 51.48 points to close at 5599.90.

In South Korea, stocks finished up as eased fears over Greek sovereign debt sparked appetite for risky asset. Extending two straight days of gains, the benchmark Korea Composite Stock Price Index (KOSPI) advanced 26.38 points or 1.65% to end at 1,627.43.

In Singapore, the share market bolstered by positive Wall Street overnight and stronger Asian cues, strength in commodity prices, and generally upbeat earnings results. Gains were also supported by firmer European bourses Wednesday and US index future Indicating Dow might open higher. At the settlement, the blue chip Straits Times Index was at 2,794.06, gained 35.16 points or 1.27%, from Fridays closes at 2,758.90.

On economic section, statistic department of Singapore said month on month non-oil domestic exports declined seasonally adjusted 8.9% in January, compared to the previous month’s 4.2% increase. On annual basis, NODX grew by 21% in January 2010, following the 26% rise in previous month, due to higher electronic and non-electronic NODX.

In Philippines, momentum remained very strong in Philippines equities as the markets hit nearly one month high above 3000 mark, as bullish sentiment took off on the back of strong gains on Wall Street overnight. The benchmark index PSEi escalated 1.71% or 50.96 points to 3,018.67, while the All Shares index went up 1.23% or 23.32 points to 1,908.14.

In India, the key benchmark indices rose for the second straight day tracking firm global stocks. Metal, banking, consumer durables and auto stocks rose. The market breadth was strong. The BSE 30-share Sensex was up 202.23 points or 1.25% to 16,428.91. The S&P CNX Nifty was up 58.25 points or 1.20% to 4,914.

Elsewhere, Malaysia’s Kula Lumpur Composite index finished slightly higher at 1259.07 while stock markets in Indonesia’s Jakarta Composite index gained by 22.84 points ending the day higher at 2581.34.

In other regional market, European shares rose for the third straight session on Wednesday, as earnings out from the banking sector again helped to offset worries about Greece's fiscal position. On a regional level, the U.K. FTSE 100 index rose 0.73% or 38.44 points to 5,283, the German DAX index advanced 0.97% or 54.26 points to 5,646 and the French CAC-40 index was up by 55.93 points or 1.52%, trading at 3,725.