Rally lifts energy firms, US dol­lar dips on risk con­fi­dence

The China Post - - BUSINESS INDEX & -

Oil prices on Wed­nes­day ex­tended a rally on hopes a global sup­ply glut could be eas­ing, boost­ing Asian energy shares, while a broadly con­fi­dent out­look saw emerg­ing cur­ren­cies surge against the U.S. dol­lar.

Mar­ket heavy­weight Sam­sung Elec­tron­ics dragged South Korean shares higher as it soared af­ter flag­ging a mas­sive in­crease in op­er­at­ing profit for July-Septem­ber.

Global mar­kets have steamed ahead since the re­lease Fri­day of un­der­whelm­ing U.S. jobs data that low­ered ex­pec­ta­tions the U.S. Fed­eral Re­serve will tighten mon­e­tary pol­icy be­fore the end of the year.

On Tues­day U.S. crude bench­mark West Texas In­ter­me­di­ate jumped 4.9 per­cent while Brent North Sea crude soared 5.4 per­cent af­ter the U.S. Depart­ment of Energy forecast a drop in av­er­age pro­duc­tion in 2016 and an in­crease in global de­mand this year.

“There’s a bit of op­ti­mism creep­ing into the mar­ket,” Jonathan Bar­ratt, the chief in­vest­ment of­fi­cer at Ay­ers Al­liance Se­cu­ri­ties in Syd­ney, told Bloomberg News.

“Prices have found a base, US$45 has been a very solid level and it will be very hard to break back down be­low that.”

Among Asian energy play­ers, Hong Kong-listed shares of main­land China’s CNOOC surged 13.74 per­cent and PetroChina ral­lied more than 9 per­cent. In Syd­ney, San­tos soared al­most 12 per­cent while Ori­gin was up 9.7 per­cent.

Re­gional stock mar­kets were also higher, with Hong Kong clos­ing 3.13 per­cent up and Sin­ga­pore adding 2.22 per­cent in the af­ter­noon. Syd­ney closed 0.59 per­cent stronger and Seoul ad­vanced 0.76 per­cent by the close.

Sam­sung Surge

Tokyo re­cov­ered from morn­ing losses to end 0.75 per­cent higher de­spite the cen­tral bank’s de­ci­sion to hold fire on ex­pand­ing its as­set-buy­ing scheme in the face of sput­ter­ing growth.

In Seoul, Sam­sung piled on 8.7 per­cent af­ter it said it ex­pected to see an 80 per­cent jump in thirdquar­ter op­er­at­ing profit.

An­a­lysts put the block­buster fig­ure down to a weaker Korean won and im­proved sales of tele­vi­sions and chips as it moves away from its re­liance on smart­phones ow­ing to stiff com­pe­ti­tion from Ap­ple and Chi­nese ri­vals.

“With slug­gish sales of Gal­axy S6 ... the (semi­con­duc­tor and TV) busi­nesses were a ma­jor fac­tor be­hind the sur­prise earn­ings,” said Lee Se­ung-Woo, an­a­lyst at IBK Se­cu­ri­ties.

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