Asian markets rise on improving economic data, better corporate earnings
By Stephen Wright, APFriday, July 24, 2009
Asian markets rise on improving data, earnings
BANGKOK — Asian stock markets climbed Friday as economic data and company earnings reinforced confidence that a recovery from the global recession is under way.
South Korea’s benchmark index gained modestly after news that Asia’s fourth-largest economy grew at its fastest pace in nearly six years in the second quarter, adding to evidence the region is bouncing back.
Stronger-than-expected U.S. corporate earnings have added to the case for an economic turnaround while a jump in home sales propelled the Dow Jones industrials to its first close above 9,000 since January.
Tokyo shares were up nearly 1 percent while oil prices largely held onto the big gains made overnight amid signs the U.S. economy, the world’s largest, is improving.
But there are still nagging doubts about whether the massive gains in world markets since March can be sustained.
“What is happening in the markets is quite irrational,” said Peter Lai, investment manager at DBS Vickers in Hong Kong. “The global economic situation doesn’t justify the rise in stock prices. The rally is driven by liquidity and hot money not by fundamentals,” he said.
Japan’s Nikkei 225 stock average was up 134.78 points, or 1.4 percent, to 9,927.72 and Hong Kong’s Hang Seng gained 92.25, or 0.5 percent, at 19,909.95.
South Korea’s Kospi was 0.3 percent higher after figures showed the economy grew 2.3 percent in the second quarter as increased government spending and record low interest rates helped to insulate it from the global recession. Singapore and China have also released stronger growth figures in recent weeks.
In Seoul, shares of Samsung Electronics dropped 0.2 percent despite the world’s biggest maker of memory chips and flat screen TVs reporting a 5.2 percent rise in second quarter profit.
Elsewhere, Australia’s market gained 0.8 percent, Singapore was 1.2 percent higher while Taiwan’s benchmark edged lower by 0.4 percent.
China’s Shanghai market gained 1.8 percent, shrugging off fears that a construction company’s massive share sale could weigh on stock prices. China State Construction Engineering Corp., the company that built the “Water Cube” swimming center for the Beijing Olympics, said Friday that it raised $7.3 billion in the world’s biggest initial public offering this year.
In the U.S. on Thursday, Wall Street was buoyed by news that existing home sales rose in June for the third straight month and by a higher-than-expected amount.
The Dow Jones Industrials, the stock market’s best-known indicator, shot up almost 190 points to 9,069.29, its highest level since November, and all the other big indexes gained more than 2 percent.
Oil prices drifted below $67 a barrel but mostly held onto gains made overnight. Benchmark crude for September delivery was down 27 cents to $66.89 a barrel. On Thursday, the contract added $1.76 to settle at $67.16.
In currencies, the dollar fell to 94.83 yen from 95.02. The euro rose to $1.4161 from $1.4157.
Tags: Asia, Bangkok, China, Construction, Construction Sector Performance, East Asia, Greater China, Hong Kong, North America, Real Estate, Recessions And Depressions, Southeast Asia, United States, World Markets