Sun, Jun 15, 2014 - Page 15 News List

Asian stocks pare weekly gain on higher oil prices

Bloomberg

Asian stocks slipped, paring the regional index’s fifth straight weekly gain, as airlines retreated on surging oil prices amid escalating violence in Iraq. Energy explorers jumped.

Korean Air Lines Co dropped 1.6 percent, pacing losses among carriers. Inpex Corp, Japan’s biggest energy explorer, surged 4.5 percent. Advantest Corp climbed 3.6 percent in Tokyo after the Nikkei Shimbun reported that the maker of chip- testing equipment raised its target for operating margins on rising orders.

The MSCI Asia Pacific Index lost 0.1 percent to 144.26 as of 4:15pm in Hong Kong, after falling 0.7 percent earlier. The gauge is set to advance for a fifth week, its longest streak of gains since August, amid signs China’s economy is stabilizing and the US recovery is intact.

A surge in violence across Iraq, three years after US troops withdrew from the country, raised the prospect of a return to civil war in OPEC’s second-biggest oil producer.

“The Iraq situation has the potential to become more significant, so people are naturally concerned,” said Angus Gluskie, a fund manager at White Funds Management in Sydney.

Any pullback will be limited because “the underlying factors that have driven the market higher haven’t really changed. They’re still reasonably strong,” he said.

In Taipei, the TAIEX closed the week higher at 9,196.39 from 9,134.46 on June 6. However, the index weakened on Friday, as large-cap stocks such as Taiwan Semiconductor Manufacturing Co (台積電) and Hon Hai Precision Industry Co (鴻海精密) remained slow due to technical resistance ahead of 9,200 points, dealers said.

“The local market was still in consolidation mode as technical hurdles ahead of the range between 9,200 points and 9,300 points remained strong,” KGI Securities (中信證券) analyst Phil Chu said.

Japan’s TOPIX gained 0.5 percent on Friday. The Bank of Japan maintained its policy of expanding the monetary base at a pace of ¥60 trillion (US$588 billion) to ¥70 trillion per year, in line with expectations.

Hong Kong’s Hang Seng Index rose 0.6 percent and China’s Shanghai Composite Index added 0.9 percent as data showed China’s retail sales increased 12.5 percent last month from a year earlier, while industrial output expanded 8.8 percent.

“The global recovery looks sustainable,” Nader Naeimi, Sydney-based head of dynamic asset allocation at AMP Capital Investors Ltd said by phone. “There’s a little bit of concern on Iraq, but that will have limited impact on growth. The impact of higher oil prices on the economy won’t be as significant given the availability of alternative fuels like shale gas.”

China’s money-supply growth topped estimates last month, as the government supports economic growth while reining in shadow banking. Data released on Thursday after markets closed showed new local-currency loans rose last month to 870.8 billion yuan (US$140 billion). That compared with the 750 billion yuan median estimate of 43 economists surveyed by Bloomberg. M2, the broadest measure of money supply, rose 13.4 percent, compared with a median projection for 13.1 percent.

South Korea’s KOSPI dropped 1 percent. Australia’s S&P/ASX 200 Index fell 0.4 percent and New Zealand’s NZX 50 Index slid 0.5 percent. India’s S&P BSE Sensex Index decreased 1.1 percent and Singapore’s Straits Times Index was little changed. Manila dropped 0.36 percent.

This story has been viewed 3670 times.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top