Sun, Aug 24, 2014 - Page 15 News List

Asian stocks buoyed by US economic strength

Bloomberg and staff writer, with CNA

Asian stocks rose, with the regional benchmark index completing two weeks of gains, after reports from US housing to manufacturing showed the world’s largest economy is strengthening.

Iluka Resources Ltd climbed 3.4 percent in Sydney after posting an unexpected profit. Santos Ltd jumped 3.9 percent as earnings increased at the Australian oil and gas producer. Li & Fung Ltd (利豐) lost 4.6 percent in Hong Kong after the world’s largest supplier of clothes and toys to retailers said conditions would remain challenging in the US and Europe.

The MSCI Asia Pacific Index added 0.2 percent to 148.78 at 7:13pm in Hong Kong, taking its gain this week to 0.5 percent. The index is within 0.5 percent of a six-year high as investors await clues on the timing of US interest-rate increases from US Federal Reserve Chair Janet Yellen when she speaks to a Kansas City Fed conference in Jackson Hole, Wyoming.

“Data was solid,” said Evan Lucas, a Melbourne-based markets strategist at IG Ltd. “US home sales smashed estimates and held true month-on-month, while the Philly Fed manufacturing index also was stronger than estimated. This all gave the market another reason to continue to leg up.”

In Taipei, the TAIEX rallied 1.4 percent this week to 9,380.10. The index closed above the 9,300-point mark on Friday for the first time since Aug. 4 after recent consolidation, as investors took their cues from gains on Wall Street overnight to hunt bargains, dealers said.

Buying was seen across the board, with the bellwether electronics sector staging a strong technical rebound, while the financial sector continued to move higher, lending more support to the broader market, the dealers said.

Old-economy stocks, particularly China concept stocks, which have close business ties with China, also attracted buying as investors shrugged off China’s worse-than-expected manufacturing activity data for August, they added.

Gainers in the electronics sector included Asustek Computer Inc (華碩電腦), which rose 2.36 percent from Thursday to close at NT$303, and Quanta Computer Inc (廣達), which gained 2.93 percent to end at NT$84.40. Taiwan Semiconductor Manufacturing Co (台積電), the most heavily weighted stock in the local market, added 0.8 percent to NT$125.50, while Hon Hai Precision Industry Co (鴻海精密), which assembles iPhones and iPads for Apple Inc, rose 1.38 percent to NT$110.

“I expect these local suppliers to Apple will gain further, in particular in September, when the US firm unveils new products,” Taishin Securities Investment Advisory (台新投信) analyst Tony Huang (黃文清) said.

In the financial sector, Mega Financial Holding Co (兆豐金控) added 2.15 percent to close at NT$26.10 and Cathay Financial Holding Co (國泰金控) rose 1.96 percent to NT$51.90.

The Philippines’ PSEi Index rose 1.8 percent. Hong Kong’s Hang Seng Index and China’s Shanghai Composite Index rose 0.5 percent. The Hang Seng China Enterprises Index gained 1.1 percent and South Korea’s KOSPI advanced 0.6 percent. New Zealand’s NZX 50 Index edged up 0.3 percent and Singapore’s Straits Times Index added less than 0.1 percent. India’s S&P BSE Sensex climbed 0.2 percent, extending its surge this year to 25 percent. Australia’s S&P/ASX 200 Index advanced, while Japan’s TOPIX slid 0.4 percent.

While a report in the US on Friday showed fewer Americans than forecast applied for unemployment benefits last week, tepid wage growth and slow inflation have given the Fed room to hold interest rates near zero.

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