Stocks mostly advance in Asia

Asian markets gain on upbeat US economic data, bargain hunting

Asian markets gained modestly today as positive closing on Wall Street in the previous session despite crude oil prices surging past the $100 a barrel mark on better than expected economic data triggered a wave of bargain hunting. In overnight trades, the US stocks ended mostly higher as the Fed's Beige Book stated that economic activity continued to expand at a modest to moderate pace in January and early February but also noted that costs are rising for manufacturers and retailers in most areas. However, the real turner proved to be monthly data out from payroll processor ADP, which indicated that US private companies added 217,000 jobs in February. The Dow edged up by 8.78 points or 0.1% to close at 12,066.80.



In Japan, the stocks surged after the pounding witnessed in the last session as optimistic data from the US led to a steady array of bargain hunting. A report released by the Ministry of Finance revealed that capital spending in the country was up 3.8% in the fourth quarter of 2010 compared to the previous three months. Excluding software, capital spending rose 4.8 percent on quarter in Q4 - but that also missed forecasts for a 5.2 percent quarterly increase following the 4.8 percent rise in the third quarter. The benchmark Nikkei 225 Index added 93.64 points, or 0.9%, to 10,586.02 by the close.

In Australia, markets added modest gains but the weak domestic economic data kept the advances very much limited. A report released by the Australian Bureau of Statistics revealed that building approvals declined a seasonally adjusted 15.9 percent in January compared to the previous month, following the revised 10.0 percent increase in December. On an annual basis, building approvals plunged a whopping 24.8 percent - following the 5.0 percent contraction in the previous month. In Australia, the benchmark S&P/ASX200 Index added 2.30 points, or 0.07 percent, to 4,806.40 points.

In China, the markets revered the latest gains though the benchmark Shanghai Composite Index managed to hold above the critical levels of 2900 points. The index closed with a loss 9.98 points, or 0.34% to end at 2,903.83. China's non-manufacturing activity contracted in February for the first time in a year as the non-manufacturing business activity index fell to 44.1 in February from 56.4 in the prior month, the China Federation of Logistics and Purchasing said today. A reading below 50 suggests contraction in the sector. The previous contraction was in February 2010. However, the drop was mainly due to seasonal factors. The firms surveyed in the index are more optimistic about the future, with the corresponding sub-index rising to 68.7 from 68.1 in January.

In Mumbai, the key benchmark indices eked out small gains in a highly volatile trade on hopes for financial sector reforms and on firm global stocks. Latest data showing easing of food inflation in mid-February 2011 and the services activity expanding at its fastest clip in three months in February 2011, also aided sentiment. The market gained for the fourth straight day. India food prices inflation as measured by the whole sale prices rose 10.39% annually in the week ended February 19, a latest update from the Ministry of Commerce & Industry stated today. Food inflation eased from 11.49% recorded in the previous week though it has remained above 10% for the last three months. Meanwhile, fuel prices climbed at a faster pace of 12.56% compared with 12.14% in the previous week. As per provisional figures, the BSE 30-share Sensex was up 56.78 points or 0.31% to 18,503.28. The index gained 157.07 points at the day's high of 18,603.57 in early afternoon trade, its highest level since 18 February 2011. The Sensex lost 192.88 points at the day's low of 18,253.62 in morning trade.

In other markets, the HangSeng Index in Hong Kong added 0.32%, the Strait Times Index in Singapore edged up by 0.33% while KOSPI Index in South Korea surged 2.20%. The European Central Bank meets today and though the bank is fully expected to leave its key-lending rate unchanged at a record-low 1%, the policy makers could give a brief about taking steps toward winding down its emergency funding programs and setting the stage for an interest-rate hike in coming months given the soaring price pressures. The Middle East turmoil has affected Europe more badly than US as the Brent crude oil prices, the London benchmark have soared to $120 per barrel. The commodities complex witnessed a sell off today though. Gold dropped around 15 dollars to near $1420 per ounce in electronic trades while WTI crude oil also came off a high near $103 per barrel and currently trades at $101.61, down 62 cents on the day.