Asian stocks rebounded on Friday in a continued rollercoaster ride, with investors taking courage from gains on Wall Street after US growth figures suggested the recent panic over interest rates might be overdone.
Dealers said it was a relief to see solid gains after the battering the markets have taken over the past few weeks on fears the US Federal Reserve could hike rates further than expected to dampen growth and inflation.
Figures overnight showed the US economy grew a revised 5.3 percent in the three months to March, a sharp increase on the fourth quarter's 1.7 percent but still well below forecasts for 5.8 percent while inflation was subdued.
PHOTO: PATRICK LIN, AFP
That was enough for a nervous Wall Street which rose 0.84 percent and set Asian stocks up for a strong technical rebound amid hopes the worst, at least, may now be over.
Dealers said investors need certainty above all on US interest rates -- let them be up, unchanged or down, it does not matter just as long as the lead is absolutely clear to allow for a rational calculation of profit and loss.
Global stock and commodity markets have been savaged brutally since the Fed indicated earlier this month its current round of hiking interest rates could soon be over.
Sydney was up 1.55 percent and back above the key 5,000 points level, Tokyo, rose 1.77 percent and in Hong Kong, up 1.26 percent, the view was that the recent losses had been overdone and there was now an opportunity to get back into the market. Mumbai climbed 1.34 percent.
The Jakarta stock market was closed for a public holiday.
Taipei
Taipei share prices closed 0.26 percent higher as late pressure on large-cap electronic stocks offset some of the gains driven earlier by Wall Street's overnight rally.
Dealers said companies with substantial property holdings extended defensive gains while some large-cap electronic stocks lost ground on continuing uncertainties about the industry outlook.
The weighted index rose 17.86 points at 6,879.5 on turnover of NT$126.72 billion (US$3.95 billion).
The market opened higher due to the strong showing on Wall Street, but "selling pressure emerged in late session and put a lid to the index's rise," said Johnny Lee, manager with President Securities (
"Investors who built their electronics [portfolios] previously at highs scaled down their holdings in late session," he said.
He said the prospects of some of these stocks were marred by uncertainties about the companies' performance during this seasonally weak quarter, as well as about taxation and the changes in accounting practice involving employees' bonus shares.
Tokyo share prices closed 1.77 percent higher as gains on Wall Street and bargain-hunters helped the market rebound.
Dealers said investors took heart from an upward revision of US first-quarter GDP data which showed the world's largest economy growing at 5.3 percent, below forecasts of 5.8 percent, which helped ease concerns over the outlook for US interest rates.
The NIKKEI-225 index gained 277.01 points to 15,970.76.
Volume was 1.65 billion shares, down slightly from 1.69 billion on Thursday, when the market fell 1.34 percent.
"Given the improved external environment and Japanese stocks turning cheaper after the sharp falls, investors hunted for bargains," said Hideo Mizutani, a chief strategist at Sieg Securities.
Seoul share prices closed 2.06 percent higher, with sentiment buoyed by Wall Street's overnight advance and a growing recognition that recent inflation fears were overdone.
Dealers said the market was strong throughout the session and intensified its gains as program buying kicked in and institutional investors building up positions.
Sharp gains in Tokyo also boosted sentiment.
The KOSPI index closed up 26.67 points at 1,322.43.
Hong Kong share prices closed 1.26 percent higher tracking Wall Street's gains overnight as the latest US economic data helped investors put aside interest rate worries and focus instead on attractive valuations of local stocks.
Dealers said HSBC and China Mobile led blue chip gains on bargain-hunting, while commodity plays did well following a rebound in metals prices overnight.
Gains on the Japanese market also supported sentiment.
The Hang Seng Index closed up 198.21 points at 15,895.10.
"I believe the market is on a technical rebound following a recovery of Wall Street and other Asian markets," said Philip Chan, research head at CSC Securities.
"Investors believe the recent sell-down may have been overdone and are now focused on chasing counters whose valuations improved a lot following the [recent] sell-off," he said.
Shanghai
Shanghai share prices closed 1.42 percent higher, bouncing back as investors looked for bargains after recent losses, with heavyweight banks and steelmakers leading the gains.
Dealers said there was some money coming into the market to build positions on the view that the recent reversal has been overdone but it was significant that turnover continued relatively modest, reflecting some cautiousness.
The Shanghai A-share Index rose 23.80 points to 1,695.41, and the Shenzhen A-share Index was up 8.45 points or 2.06 percent at 419.51. The benchmark Shanghai Composite Index, which covers A and B-shares, added 22.47 points or 1.41 percent at 1,613.89.
Sydney share prices rallied 1.55 percent, sending the benchmark SP/ASX 200 index above the key 5,000 points level on the back of a recovery on Wall Street and stronger commodity prices.
Dealers said revised first quarter US growth figures at 5.3 percent were below expectations of 5.8 percent, thereby helping reassure investors nervous about the outlook for interest rates which gave an immediate boost in New York.
The SP/ASX 200 climbed 75.9 points to close at 5,053.7.
Singapore share prices closed 1.69 percent higher, lifted by gains in property stocks ahead of the announcement of the winning bid for the city-state's first gaming license. The Straits Times Index rose 40.57 points to 2,445.02.
7Kuala Lumpur share prices closed 0.73 percent higher, with investors encouraged by stronger regional markets to seek out blue chips. The composite index added 6.78 points to 930.75.
"The strong rebound in US and regional markets helped spur sentiment and gave investors a reason to buy blue chips," a local brokerage dealer said.
Bangkok share prices closed 2.35 percent higher, led by a rebound on Wall Street as the latest data on the US economy eased concern over rising US interest rates.
The composite index rose 16.47 points to close at 717.50.
Manila share prices closed 3.2 percent higher due to a technical recovery after three straight days of losses.
The composite index gained 71.06 points to 2,300.39.
Wellington share prices rose 0.52 percent as local investors reacted positively to firmer world markets.
The NZSX-50 gross index rose 18.93 points to close at 3,599.43.
Mumbai share prices extended their gains for a second day to close up 1.34 percent, led by domestic fund buying in large-cap stocks as the market was cheered by a rally on Wall Street.
The benchmark 30-share Mumbai stock exchange SENSEX rose as much as 3.6 percent in early morning trade, but retraced some gains on profit-taking to close up 143.03 points at 10,809.4.
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