Asian stocks follow Wall St. higher, but euro beats retreat
Asian markets on Tuesday followed a positive lead from Wall Street while the euro retreated as investors kept a cautious eye on Europe, where Greece is struggling to pay its debts.
Tokyo jumped 1.40 percent, or 274.60 points, to finish at 19,909.09 and Shanghai rallied 1.82 percent, or 76.55 points, to 4,293.62. Hong Kong surged 2.79 percent, or 755.56 points, to 27,850.49.
Sydney gained 0.67 percent, or 39.2 points, to 5,872.3 but Seoul was marginally lower, edging down 1.92 points to 2,144.79.
The gains reversed some of the losses suffered on Monday, partly on fears about Greece’s future in the eurozone as Athens tries to secure billions of euros in bailout cash to pay its enormous debts.
With creditors refusing to extend a repayment deadline while also haggling over its bailout reforms, the Greek government has ordered all public agencies to hand over their financial reserves.
“With this act, the government hopes to cover urgent needs of the state amounting to three billion euros for the next 15 days,” said a decree, which still needs adoption by the parliament.
The euro fell in foreign exchange markets Tuesday, buying US$1.0677 and 127.74 yen against US$1.0741 and 128.05 yen on Wall Street.
Hong Kong and Shanghai resumed their upward trend following sharp losses Monday, after China’s stock market regulator tightened rules on trading with borrowed money and increased the supply of shares for short-selling.
Hong Kong stocks have yo-yoed as investors continue to evaluate regulatory changes for stock investors as well as monetary loosening measures, both announced by mainland Chinese authorities over the weekend. Mainland investors seeking attractively priced stocks have been piling into the Hong Kong market, which has underperformed compared with Shanghai over the past year.
Confidence was buoyed by Sunday’s cut by the People’s Bank of China in the amount of cash which banks must hold in reserve. The move was aimed at helping kick-start the economy, which grew in January-March at its slowest quarterly pace for six years.
Separately, the country’s stock regulator said Saturday that new measures to tighten up on some margin financing and encourage short selling were intended to prevent the market’s development and not meant as a crackdown.
The next indicator on the state of China’s economy comes with HSBC’s preliminary index of manufacturing activity on Thursday.
Hong Kong’s Hang Seng jumped 2.1 percent to 27,666.06 and the Shanghai Composite Index in mainland China added 0.9 percent to 4,253.55. Japan’s Nikkei 225 gained 1 percent to 19,837.80 while South Korea’s Kospi was down 0.2 percent at 2,2141.99. Australia’s S&P/ASX 200 climbed 0.6 percent to 5,864.90,
Gold fetched US$ 1,198.35 US$1,200.30 late Monday.
In other markets:
fell 0.75 percent, or 210.17 points, to end at 27,676.04.
Sun Pharmaceutical Industries fell 8.86 percent to 951.60 rupees, while miner Sesa Sterlite rose 1.59 percent to 211.30 rupees.
— Jakarta closed up 1.11 percent, or 59.77 points, at 5,460.57.
Palm oil producer Astra Agro Lestari rose 2.30 percent to 23,350 rupiah, while Hero Supermarket 5.50 percent to 1,890 rupiah.
— Bangkok rose 0.58 percent, or 9.03 points, to close at 1,569.35.
Siam Commercial Bank gained 3.81 percent to 177.00 baht, while Siam Cement rose 2.29 percent to 536.00 baht.
— Kuala Lumpur’s main index rose 0.76 percent, or 14.14 points, close the day at 1,862.80.
Gaming and resorts company Genting gained 5.38 percent to 9.2 ringgit, while Petronas Chemicals rose 4.86 percent to 6.04 ringgit. IOI Corp slipped 1.56 percent lower, closing on 4.42 ringgit.
— Singapore rose 0.15 percent, or 5.36 points, to close at 3,508.61.
Property developer Capitaland climbed 0.28 percent to SG$3.65 and oil rig maker Keppel Corp gained 1.19 percent to SG$9.36.
— Wellington eased 0.12 percent, or 6.76 points, to 5,817.52.
Spark was down 1.72 percent at NZ$2.85 and Fletcher Building was unchanged at NZ$8.25.
— Manila lost 0.23 percent, points, to end at 7,846.94.
BDO Unibank slipped 0.51 percent to 116.40 pesos but Universal Robina rose 0.92 percent to 218.60 pesos.