Asian buyers back in business

Stocks stage steady gains; crude tops $77 before easing

The Asian markets were mostly higher today as the despite positive closing on Wall Street in the previous session. Some buying emerged in the resources as crude oil topped $77 per barrel mark and steady earnings news from the US made investors buy the Asian stocks. Dollar also stayed near 1.3000 mark before paring the losses in late trading. However, bulk of the action in Asia was over by that time and even as DOW futures slid lower by 88 points, the Asian markets were mostly cushioned from it.



The sentiments in the early moves were a little jerky, and Japanese market, which opened after 3-day extended holiday, dropped on a stronger Yen. Exporters and Technology shares led to a sustained selling spree and the benchmark Nikkei 225 Index dropped 107.90 points, or 1.15% to close at 9,280, while the broader Topix index of all First Section issues closed down 8.32 points, or 0.99%, to 832.

On the economic front, a report released by the Cabinet Office in Japan revealed that the country's leading index for May was revised down to 98.6 from 98.7 reported earlier. The indicator had dropped in April to 101.7, the first monthly fall after rising for 13 straight months. As per the report, the Conference Board's leading economic index for Japan fell 0.6% month-on-month in May. This followed a 0.1% decrease in the previous month. At the same time, the coincident economic index, which is a measure of current economic activity, was down 0.4% in May compared to April.

The Australian stocks jumped as mining stocks rose on speculation that China will not tighten its monetary policy moves to curb economic growth. Miners had taken a big hit yesterday when Prime Minister Gillard called a general election for Aug. 21, setting the stage for a battle that will determine whether the nation's resources companies pay higher taxes. The benchmark S&P/ASX200 Index advanced 45.30 points, or 1.04% and closed at 4,404, while the All-Ordinaries Index ended at 4,419, representing a gain of 46.00 points, or 1.05%.

On economic front, minutes of the recent Reserve Bank of Australia policy board meeting released today showed that the members wanted to adopt a wait-and-watch attitude before making their next policy move, while reiterating that their decision to hold interest rates steady was justifiable given rates had already returned to "average" levels.

One of the prime beneficiaries of the strong US cues were the Chinese stocks. Markets in China rallied from the start, with the benchmark index breaking above a key level on hopes that the government may relax its policy tightening measures spurred gains for the nation's banks and property companies. The Shanghai Composite Index, which tracks the bigger of China's stock exchanges, added 53.31, or 2.2 %, to 2,528.73.The Shanghai Composite has declined 23% this year on concern measures by the government to control real-estate speculation and rising consumer prices will damp growth.

In Mumbai, the key benchmark indices lost ground to hit the day's lows in late trade as European stocks fell and as US index futures tumbled. The BSE Sensex fell below the psychological 18,000 mark after crossing that level in early trade. Auto and banking stocks reversed initial gains. Healthcare stocks also fell. As per provisional figures, the BSE 30-share Sensex was down 75.69 points or 0.42% to 17,852.73. The Sensex rose 111.75 points at the day's high of 18,040.17 in early trade. The index lost 80.35 points at the day's low 17,748.07 in late trade. The S&P CNX Nifty was down 32.80 points or 0.61% to 5,353.65 as per provisional figures.

In other markets, Hang Seng in Hong Kong added 0.86%, Jakarta Composite in Indonesia moved up 0.67%, KLSE Composite in Malaysia gained 0.32% while Taiex in Taiwan surged 0.81%.

Euro turned lower after hitting levels above 1.3000 against the US dollar as the markets eyed the key US housing data today and the speech of the US Fed Chainman Ben Bernanke tomorrow. The DOW futures slumped 88 points and European stocks also came off their highs. Crude oil had topped a high of $77.03 earlier in the day but flipped back direction to trade at $75.45 per barrel right now, down 9 cents. Gold also eased, breaking under $1180 per ounce mark.