Asian stocks rose for a second consecutive week after the US Federal Reserve renewed its pledge to stimulate growth in the world’s biggest economy with low interest rates, boosting the outlook for the region’s exporters.
“We have a combination of loose monetary settings and low interest rates and strong earnings,” said Nader Naeimi, a Sydney-based strategist for AMP Capital, which has almost US$100 billion under management. “It’s a pretty good cocktail for a good equity market.”
The MSCI Asia Pacific Index rose 0.47 percent to 139.48 last week. The gauge gained 2.2 percent the previous week as US housing starts gained and companies such as Apple Inc reported earnings that beat estimates, boosting confidence in global economic growth.
The TAIEX fell 32.90 points, or 0.36 percent, to 9,007.87 on Friday. The benchmark index rose 0.4 percent this week and 3.7 percent this month.
“Ahead of the 9,100 point mark, the market is faced with great technical pressure,” TLG Asset Management (台壽保投信) analyst Arch Shih (施博元) said. “Many investors have been watching this closely.”
Shih said these investors have become wary as they have witnessed other major markets in the region, including China’s, falling amid fears that foreign investors will move funds out of Asia.
“I expect the local bourse will need some time to consolidate to digest the selling,” he said.
Selling was concentrated on large-cap stocks on Friday, in particular optoelectronics firms, after they announced worse-than-expected first quarter results, according to the dealers.
Taiwan Semiconductor (台積電) gained 3.2 percent to NT$73.20 on Friday. The company on -Thursday reported an 8 percent increase in first-quarter profit, more than analysts estimated, after demand for smartphones and tablets drove sales of pricier chips. Goldman Sachs boosted its rating on the stock to “buy” from “neutral” before the results, citing valuations and the company’s growth outlook.
Japan’s Nikkei 225 Stock Average increased 1.7 percent this week, extending a rebound following a record earthquake and tsunami on March 11 that left thousands dead and damaged supply chains. Australia’s S&P/ASX 200 Index advanced 1.8 percent this week, while Singapore’s Straits Times Index lost 0.5 percent. Hong Kong’s Hang Seng Index declined 1.7 percent. China’s Shanghai Composite Index dropped 3.3 percent, the biggest weekly decline since November.
Markets in Australia, New Zealand and Hong Kong were closed for a holiday on Monday. Australia was also closed the following day. Markets in Japan were closed on Friday.
In other markets on Friday:
Manila ended up 0.95 percent, or 40.68 points, from Thursday at 4,319.51.
Philippine Long Distance Telephone gained 1.0 percent to 2,486 pesos, Lopez Holdings added 4.2 percent to 6.40 pesos while Philex Mining was up 2.3 percent at 17.87.
Wellington rose 0.44 percent, or 15.57 points, from Thursday to 3,519.33.
Retailer The Warehouse Group rose 1.4 percent to NZ$3.65, Air New Zealand was unchanged on NZ$1.11 and Telecom Corp slipped 0.5 percent to NZ$2.17.
Mumbai’s benchmark 30-share SENSEX fell 0.81 percent, or 156.06 points, from Thursday, its fifth straight day of losses to 19,135.96.
Sentiment has turned cautious ahead of the Reserve Bank of India’s monetary policy meeting on Tuesday, where it is widely expected to hike interest rates by 25 basis points.