Markets in Asia steady as hopes of global recovery rise

Hong Kong: Asian stocks were mixed on Friday as confidence about the state of the global economy was pegged back by profit-taking following another strong week on the trading floors.

Hong Kong was flat, while Sydney added 0.71% and Tokyo was 0.11% lower as investors made the most of big gains over the past five days. The advances since Monday follow a similar pattern that began at the start of March. There were also slight gains in Shanghai, while Taipei was flat and Seoul and Singapore ended lower.

Dealers have taken some heart over the past few weeks as small pieces of good news recently suggest the heat may be coming out of the global financial crisis that has wiped billions off shares since last year.

The market in Japan was initially strong after overnight gains on Wall Street, but it gradually trimmed those advances in the afternoon and turned negative as players locked in profits. The Nikkei has gained 8.6% in the trading week, and is up 22% from its lows earlier this month.

Gains trimmed: A 26 March picture of a share prices board in Tokyo. On Friday, the market was initially strong, but closed in negative territory. Yoshikazu Tsuno / AFP

Shippers led the losses, with Nippon Yusen Kabushiki Kaisha falling 3.9% to 414 yen (Rs219.42) after it cut its net profit outlook by 80% for the fiscal year to 31 March.

Honda Motor Co. Ltd rose 3.8% to 2,465 yen after US peers such as General Motors Co. gained sharply overnight on hopes for measures by Washington to rescue the auto industry.

The Hang Seng was up 10% over the week and 24% from its 9 March low of 11,344. Sino Land Co. Ltd rose 5.5% to $8.26 and Hang Lung Properties Ltd gained 3.6% to 18.56.

But Cheung Kong Holdings Ltd, the property flagship of Hong Kong’s richest man Li Ka-shing, fell 1.3% to $70.50 after it reported a 44% decline in 2008 net profit to $15.52 billion.

Fashion retailer Esprit Holding Ltd slumped 9.9% to $43.

Australian traders pulled back slightly from a bullish morning inspired by Wall Street gains, dealers said.

Mining and gold stocks drove the market higher, with Rio Tinto rallying strongly after its chief financial officer said there were alternate capital-raising avenues if a tie-up with China’s Aluminum Corp. of China failed.

Rio shares closed up 3.99% at 56.88, while rival BHP Billiton Ltd added 0.68% to 34.01.

Australia and New Zealand Banking Group was off 1.49% to 16.55 while Commonwealth found 0.72% to $35.

Qantas was 3.64% higher at 1.85.

The Shanghai Composite Index, which covers A and B shares, rose 12.73 points to 2,374.44. The market was led by new energy stocks after the finance ministry said it would offer subsidies to the solar energy sector, dealers said.

“The A-share market is on the way to becoming a bull market, but the process will be slow and volatile,” said Wu Feng, an analyst at TX Investment.

Baoding Tianwei Baobian Electric Co. rose by the 10% daily limit to 31.28 yuan (Rs236.79). Baoshan Iron and Steel Co. Ltd advanced 3.5% to 5.95 yuan.

The market in Teipei opened up 1.52% with buying ignited by Wall Street’s gains, dealers said, but profit-taking later eroded the advances.

A decision on Thursday by Taiwan’s central bank to keep its key interest rates steady—after seven reductions since September—also made investors more confident about economic prospects, they said.

Microchip designer MediaTek Inc. lost 2.85% to $324. Taiwan Semiconductor Manufacturing Co. Ltd rose 0.39% to 51.90. Taiwan Cement Corp. lost 1.20% to 28.80 and Far Eastern Textile Ltd fell 1.13% to 26.15.

Down 0.51%, the KOSPI ended down 6.29 points at 1,237.51. The fall ended a five-day winning streak for the market.

The main index gained 5.7% this week and is up 21.5% from a trough on 2 March.

Financial stocks saw a correction after recent sharp gains. Hana Financial Group Inc. declined 7.3% to 22,100. Daewoo Engineering and Construction Co. fell 4.2% to 9,580 won (Rs383.2).

Carmakers remained in the black throughout the session after the government on Thursday announced tax cuts to spur car sales during the slump. Hyundai Motor Co. rose 2.6% to 55,100 won. Samsung Electronics Co. Ltd climbed 2.5% to 584,000 won.

The blue-chip Straits Times Index fell 13.13 points to 1,745.66.

“It’s to be expected that the market would give back some of its strong recent gains,” AmFraser’s senior vice-president of equity sales Gabriel Gan said. “I think the pullback will be fairly mild and last maybe a couple of days, then I’m expecting the uptrend to resume.”

DBS Group Holdings Ltd fell 18 cents to $8.56 and United Overseas Bank Ltd dropped 36 cents to 10.18. Singapore Airlines Ltd slipped 12 cents to 10.18 and Singapore Telecommunications gained five cents to 2.62.

The Kuala Lumpur Composite index lost 0.04 points to 885.43. Genting Bhd fell 2.1% to 3.78 ringgit (Rs53.9) while Sime Darby Bhd gained 1.7% to 5.90.

Bankok’s SET gained 1.41 points to close at 440.81. Trade was light amid fresh domestic political turmoil as an anti-government rally continued into a second day.

Thailand’s biggest lender Bangkok Bank Pcl. edged up 0.50 baht (Re0.73) to close at 76.50 baht. Energy firm PTT Plc. lost 1.00 to 160.00 while top coal producer Banpu Public Co. Ltd added 2.00 to 224.00.

The Jakarta Composite Index jumped 42.77 points to 1,462.74.

“On the chart, it looks like the main index is moving in an uptrend line, with the closest resistance at 1,480,” a trader said.

The market was closed on Thursday due to a national holiday.

PT Telekomunikasi Indonesia jumped 7% to 7,600 rupiah (Rs30.4). PT Bank Danamon Indonesia Tbk rose 7.5% to 3,225 rupiah.

The composite index in Manila added 51.99 points to 2,040.25.

The index has rallied for eight straight days and has risen about 16% since the uptick began on 18 March.

“Markets are rebounding as (economic) figures from the US aren’t as bad as we expected. Markets are now discounting the worst,” Joseph Roxas of Eagle Equities said.

Philippine Long Distance Telephone Co. gained 5.54% to 2,190 pesos (Rs2,365.2), while Globe Telecom Inc. added 3.57% to 870 pesos.

New Zealand’s benchmark NZX-50 index rose 37.22 points to 2,653.48.

“It’s probably been the best week we have had for six months, on the back of Australia and the US market,” said ABN Amro Craigs equities advisor Martin Allison.

Contact Energy Ltd rose 36 cents to $6.15. Air New Zealand Ltd rose five cents to 94 cents and Telecom New Zealand Ltd fell two cents to $2.28.

Source:Livemint