Asian stocks rise further

Markets rise for a second day on risk appetite, commodity prices

Asian stock markets added impressive gains for a second day, notwithstanding a late sell off in the US markets overnight as strong commodity prices and a continued recovery in the Euro supported the sentiments. The markets were also given a life by optimistic US economic data and very positive cues from the US stock futures throughout the day. The single currency added sharp gains on reports stating China would not be reviewing its euro holdings, ending a speculation that had riffed the markets in the last few days as the Euro tumbled to four year lows against the dollar.

The Australian market rose on miners as speculation that the Australian Government might amend its super tax proposals, as well as the smart rally in local currency against the US dollar supported the sentiments. The benchmark S&P/ASX200 Index advanced 72.00 points, or 1.67% and closed at 4,379, while the All-Ordinaries Index ended at 4,399, representing a gain of 68.70 points, or 1.59%.

On the economic front, data released by the Australian Bureau of Statistics revealed that capital spending by private sector companies in the country recorded a small decrease between January and March. Further, the report noted that most companies have also toned down their investment spending plans for the rest of the financial year, suggesting that the economic recovery may be less robust than previously thought. As per the report, private sector industries' capital expenditure between January and March fell a seasonally adjusted 0.2% compared to the preceding quarter. It follows a 6.1% increase in the previous quarter. Total capital expenditure amounted to A$27.70 billion during the three-month period.

The Japanese stock market ended in positive territory, lifted by exporters in late trading session as the local currency, yen, eased after sharp gains in the last session on signs of stability in the Euro zone. Exporters led the gains as a weaker yen boosts export realizations from abroad when converted into local currency. The benchmark Nikkei 225 Index added 117.06 points, or 1.2%, to 9640 while the broader Topix index of all First Section issues was up 10.89 points, or 1.3%, to 870.

On the economic front, a report released by the Ministry of Finance in Japan revealed that the country registered a merchandise trade surplus of 742.262 billion yen in April, topping forecasts for a surplus of 700.5 billion yen, following 948.9 billion yen surplus recorded in March. On an annual basis, trade surplus was up by 1,415.2% over surplus of 48.988 billion yen reported in the same month last year. The report further revealed that exports surged 40.4% on year to 5.889 trillion yen - beating forecasts for a 38.3% annual increase after jumping 43.5% in the previous month.

Chinese markets rose for a second day as markets sniffed the country's central bank delaying its monetary tightening campaign slightly given the recent turbulence in the global markets and seek an assessment of the Euro zone impact on the Chinese export demand. The Shanghai Composite Index, which tracks the bigger of China's stock exchanges, climbed 30.13, or 1.2 percent, to 2,655.92 at the close. The CSI 300 Index rose 1.6% to 2,859.98. Concern that the government will step up measures to curb property speculation and government debt in Europe will prevent nations from bolstering their economies has dragged the Shanghai Composite down 19 percent this year.

In Mumbai, stocks were flying right from the start and heavy buying was seen in blue chips. The Sensex closed at 16677, up 289 points and the Nifty was at 5003, up 85 points, as per provisional data. Banks rose and the sentiments were seen getting stronger on reports of the monsoon reaching the Indian coasts in the next three-four days. The rebound in sensex from levels near 16000 earlier in the week also proved critical.

In other markets, Hang Seng in Hong Kong added 1.22% while Straits Times in Singapore rose1.62% while the TSEC in Taiwan moved up 1.06%

In commodities, crude oil rose sharply on tremendous risk appetite. July WTI gained $1.79 to $73.30 a barrel, hitting a high of $73.67 earlier in the electronic session. Dollar is unable to garner much of gains and trades above 1.2300 against the Euro. Gold hit highs near 1220 and eased as rising equities led to some profit selling.