Stocks gain modestly in Asia

Upbeat overnight cues from US markets support sentiments; Middle East worries remain in place

Asian markets edged higher though the worries in Middle East post the breakout of Egypt presidency kept the gains under check for the major indices in the region. In overnight moves, the US stocks added decent gains on upbeat economic cues and a bounce in the housing starts. The minutes of the last US Fed meet stated that the economy stood on firmer ground in January in light of a pickup in the strength of a series of economic reports. The Fed raised its 2011 GDP growth expectations to a range of 3.4 percent to 3.9 percent. The US Housing starts rose sharply by much more than expected in the month of January. This kept the buyers in an active mode and markets shrugged off worrying developments in the Middle East as well as a drop in the US industrial production numbers. The Dow added 61.53 points or 0.5 percent to close at 12,288.17 points.



In Japan, the stocks closed in the positive territory, adding gains in the fourth session in a arrow as increasing optimism about sustaining economic recovery in US and the recent slide in the Japanese yet kept the sentiments supported. Economic news was also supportive with the official data released by the Japanese government revealing that the official leading indicator of the Japanese economy rose 0.8 points in December from November to reach 101.4, unrevised from preliminary estimates. It was the third consecutive month of increase in the index, which is a key indicator of the short-term outlook of the economy, and the highest score recorded since last April. The benchmark Nikkei 225 Index added 28.35 points, or 0.26 percent, to close the day at 10,836.64.

The Australian stocks gained slightly on upbeat overnight cues to end at two and half year highs. The pressure on the industrial metals prices kept the advances minimal though and the benchmark S&P/ASX200 Index added just 8.20 points, or 0.17% to end at 4,938.40 points. On the economic front, Reserve Bank of Australia assistant governor Philip Lowe stated that the economy is likely to grow around 4.25% in the whole of this year, saying that the impact of the recent floods could be slightly less than initiated estimated.

In China, stocks ended mostly on a flat note as property developers eased following reports of Beijing's municipal government unveiling restrictions to property purchases. The benchmark Shanghai Composite index still ended at two-month high following gains in banks. The index added 3.06 points or 0.1% to close at 2926.96.

In Mumbai, the key benchmark indices surged, extending gains for the fifth straight day, as the latest government data showed that food inflation eased early this month. Auto, capital goods and banking stocks were in demand. Metal stocks were mixed. Index heavyweight Reliance Industries (RIL) extended initial gains. The market breadth was strong. Except the BSE Realty index, all the rest sectoral indices on BSE rose. As per provisional figures, the BSE 30-share Sensex was up 210.13 points or 1.15% to 18,511.03. The index rose 231.71 points at the day's high of 18,532.61 in late trade. The Sensex lost 67.11 points at the day's low of 18,233.79 in morning trade.

In other markets, the HangSeng Index In Hong Kong added 0.63%, the Strait Times Index In Singapore dropped 0.38% while KOSPI Index in South Korea shed 0.60%. US dollar dropped a little before edging higher, liming gains in commodities. COMEX Gold tested $1380 before easing while crude oil also dropped well under $85 per barrel