31 Jul 2008 | 15:48
Asian Markets Continues Upward Movement
Asian
markets continued to register broad based upward movement as Wall
Street extended gains overnight on the back of positive private sector
employment data which encouraged the local buyers to look for bargain
buys. Meanwhile the crude oil showed an unexpected turn around as it
surged by about US$4.5 ending its two-week slide.
Yesterday on
Wall Street the Dow Jones Industrial Average jumped 186.13 points or
1.63% to finish at 11,583.69 and the broader S&P 500 index added
21.07 points or 1.67% to close at 1,284.26. The tech-heavy Nasdaq
composite advanced 10.10 points or 0.44% to end at 2,329.72.
Oil
prices shot up yesterday, ending a two-week slide, after a U.S.
government report showed a surprise drop in gasoline supplies. Light,
sweet crude for September delivery soared US$4.53 to US$126.72 a barrel
on the New York Mercantile Exchange. In today?s Asian session, oil was
down 7 cents at $126.70 a barrel.
In currency market, the U.S.
dollar held steady in the lower 108-yen range. In late Tokyo deals, the
dollar was quoted at 108.02-108.03 yen, up from Wednesday's close of
107.94-107.95 yen in Tokyo. The New Zealand dollar traded near 10-month
lows against the greenback on speculation that interest rates will be
cut further. The kiwi ended the session at US$0.7315 compared to
US$0.7345 late Wednesday.
The U.S. dollar closed at 1,012.1
won, down from 1,013.5 won late Wednesday. The South Korean currency
rose slightly on suspected intervention by as foreign exchange
authorities to the tune of $1 billion to prop up the local currency.
The Australian dollar fell to a six-week low after a government report
showed that retail sales dropped the most in six years in June. The
Aussie was at US$0.9453 in late local trade, after hitting a low of
US$0.9412, down from US$0.9471 late Wednesday.
Coming back in
equity markets, the Japanese stock market closed marginally higher,
extending gains for the second straight session. Though the market
started off higher, buoyed by gains on Wall Street overnight, it turned
choppy in the afternoon session and finished slightly above the flat
line. Investors turned cautious ahead of U.S. GDP numbers.
The
benchmark Nikkei 225 index closed up 9.02 points or 0.1% at 13,376.81,
while the broader Topix index of all the Tokyo Stock Exchange First
Section issues rose 0.63 point or 0.1% to end at 1,303.62.
On
the economic front, manufacturing activity in Japan recovered modestly
in July, but remained in a state of contraction. The Nomura/JMMA Japan
Purchasing Managers Index increased by 0.5 points to a seasonally
adjusted reading of 47.0 from the June level of 46.5. The June reading
was the lowest since February 2002. The survey found that manufacturing
activity continued to be negatively impacted by a slowing economy and
rising energy costs. The report's output index, which reflects
industrial production, fell to 44.2 from 44.4 in June.
Among
other data released today, Japanese housing starts declined 16.7% in
June from the previous year, after falling 6.5% in May and 8.7% in
April, according to the Ministry of Land, Infrastructure and Transport.
Economists had forecast a sharp fall of 17.8% for June. Construction
orders received by big 50 contractors dropped 11.7% versus May's 25.2%
decline. Meanwhile, Labor cash earnings unexpectedly fell by 0.6% on
year in June, according to the Ministry of Health, Labor and Welfare.
Analysts expected a 0.6% on year increase following a revised 0.8%
annual gain in May.
The Chinese market closed lower, extending
losses for a third day. The benchmark Shanghai composite index closed
down 2.15% at 2,775.72 after losing 0.5% on Wednesday.
On the
economic arena, China's retail sales hit 864.2 billion yuan (126.7
billion U.S. dollars) in June, showing a 10-year-high growth rate of 23
percent year-on-year, the National Bureau of Statistics said on
Wednesday. The growth rate was 7.0 percentage points higher than a year
earlier and 1.4 percentage points higher than in May. Adjusted for
inflation, the June growth rate was 14.8 percent, the bureau said.
Mr.
Zhuang Jian, senior economist with the Asian Development Bank PRC
Resident Mission, attributed the faster growth rate to several factors.
These included workers' expectations of rising incomes, more allowances
for low-income earners as a result of the new labor contract law and
efforts by local governments to raise welfare payments to the needy.
Retail sales stood at 5.1 trillion yuan nationwide during the first
half, up 21.4 percent, or 12.9 percent in real terms.
In Hong Kong, the Hang Seng Index rose 0.18% to 22,731.10 and the Hang Seng China Enterprises Index gained 0.3% to 12,506.74.
The
New Zealand market closed higher for the second straight session on
Thursday. Wall Street's extended gains overnight on the back of
positive private sector employment data encouraged local investors to
look for bargain buys. The benchmark NZX 50 index closed up 48.52
points or 1.48% at 3,336.28 and the broader NZX All Capital Index rose
48.68 points or 1.44% to finish at 3,379.50.
On the economic
front, the National Bank of New Zealand said that business confidence
in New Zealand fell to a reading of -43.2 in July, easing from -38.7 in
June.
The Australian stock market closed higher today, extending
gains for a second straight session. Wall Street's gains overnight on
positive private sector employment data encouraged local investors to
buy stocks. The resources stocks gained on higher prices overnight for
copper, nickel and oil. The benchmark S&P/ASX 200 index closed up
40.7 points or 0.8% at 4,977.4 and the broader All Ordinaries index
advanced 43.9 points or 0.9% to finish at 5,052.6.
On the
economic front, a report released by the Australian Bureau of
Statistics showed that Australia's balance of trade in goods and
services moved to a surplus in June. Trade surplus was A$411 million in
June compared to a deficit of A$253 million in May. Most economists
predicted a June deficit of A$100 million. Exports fell 0.6% from May
while imports were lower by 1.0%.
Meanwhile, retail sales in
Australia dropped 1.0% in June, compared to the previous month, to a
seasonally adjusted A$20.04 billion. For the second quarter, retail
sales were down 0.6% from the previous quarter against the forecasts
had called for a 0.1% decline.
The Reserve Bank of Australia
said in a report that credit extended to the private sector in
Australia increased by a seasonally adjusted 0.4% in June from the
month before. On year-over-year basis, private sector credit increased
11.7%.
The South Korean market closed higher Thursday, extending
gains for a second day, as Wall Street's gains overnight lifted
investor sentiment. However, oil's rebound following a surprise drop in
gasoline supplies in the U.S. and a slower growth in industrial output
limited the gains. The benchmark Korea Composite Stock Price Index
closed up 16.97 points 1.08% at 1,894.67 after rising as much as 1.23%
in the first few minutes of trading.
On the economic front,
South Korea's central bank said that manufacturing confidence for
August fell to an over three-year low as companies expected Asia's
fourth-largest economy to further lose steam in the second half. The
business survey index for manufacturers' expectations declined to 74
for August, compared to 77 a month earlier. The business outlook index
has fallen to its lowest level since February 2005.
Meanwhile,
National Statistical Office said that South Korea's industrial output
grew at a slower pace of 6.7% on year in June amid lingering concerns
over surging oil prices, sluggish domestic demand and a global slowdown.
Meanwhile
the Indian market was trading in a negative territory after opening
higher in the morning. The market opened higher but pared gains
immediately amid a lack of buying interest in index heavyweights. The
bounce back seen in the price of oil in New York trading on Wednesday
is keeping investor sentiment subdued. Trading remained volatile ahead
of the expiry of July derivative contracts today. The market mood is
cautious as traders await the wholesale inflation data, which is
scheduled after the close of the market today.
After trading in
a range of 14,360-14,166, the Sensex has recouped some of its losses
ending the session at 14,355, up 68 points or 0.48% over the previous
day's close.
In the other part of the world, Europe stocks
struggled to build on gains after some disappointing earnings from BT
Group and Unilever, though oil explorers rose as crude recovered to
$126 a barrel and as Royal Dutch Shell produced the highest-ever
quarterly earnings for a European oil producer.
In the opening
trade, the German DAX 30 rose slightly to 6,4562.54, the U.K. FTSE 100
fell 0.2% to 5,407.90 and the French CAC 40 fell slightly to 4,394.54.
On
the economic front the housing prices in U.K. were down 8.1% from
year-ago levels in July as the number of housing transactions dropped
to an all-time low amid tight credit conditions and economic worries.
According
to the survey conducted by mortgage lender Nationwide the house prices
in July fell 1.7% from the previous month, marking the ninth
consecutive monthly decline. The pace of the decline accelerated from a
0.8% monthly drop in June, which left prices 6.3% below year-ago
levels.
The average price stood at 169,316 pounds ($335,120) in
July, down from 172,415 pounds in June. The average price is down by
around 15,000 pounds since July 2007, falling to its lowest level since
August 2006. House prices remain around 11,000 pounds higher than three
years ago.
The drop in transactions echoes official data from
the Bank of England that showed mortgage approvals fell to just 36,000
in June.
In another release the Consumer inflation in the euro
zone accelerated at a record annual pace of 4.1% in July ? outstripping
central bank target. Annual inflation hit 4% in June, more than twice
the European Central Bank's annual target of near but just below 2%.
In
Germany, the wholesale sales in June were down 1.5% in real terms
compared with May, but rose 2.6% year-on-year, according to preliminary
figures from the Federal Statistics Office. In May, wholesale sales
fell 0.6 percent from April and rose 0.5 percent year-on-year.
Looking
ahead the market will shift its focus on some of the key economic of
the week scheduled to be released today. The key economic event for the
day is performance of US economy in second quarter analysed by the
Gross Domestic product. It will be accompanied by the data on jobless
claims. From euro zone we are left with unemployment figure for the
region. In the evening we have personal consumption expenditure for the
second quarter followed by the Chicago?s purchasing managers index for
July.
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Asian Markets Continues Upward Movement
Asian
markets continued to register broad based upward movement as Wall
Street extended gains overnight on the back of positive private sector
employment data which encouraged the local buyers to look for bargain
buys. Meanwhile the crude oil showed an unexpected turn around as it
surged by about US$4.5 ending its two-week slide.
Yesterday on
Wall Street the Dow Jones Industrial Average jumped 186.13 points or
1.63% to finish at 11,583.69 and the broader S&P 500 index added
21.07 points or 1.67% to close at 1,284.26. The tech-heavy Nasdaq
composite advanced 10.10 points or 0.44% to end at 2,329.72.
Oil
prices shot up yesterday, ending a two-week slide, after a U.S.
government report showed a surprise drop in gasoline supplies. Light,
sweet crude for September delivery soared US$4.53 to US$126.72 a barrel
on the New York Mercantile Exchange. In today?s Asian session, oil was
down 7 cents at $126.70 a barrel.
In currency market, the U.S.
dollar held steady in the lower 108-yen range. In late Tokyo deals, the
dollar was quoted at 108.02-108.03 yen, up from Wednesday's close of
107.94-107.95 yen in Tokyo. The New Zealand dollar traded near 10-month
lows against the greenback on speculation that interest rates will be
cut further. The kiwi ended the session at US$0.7315 compared to
US$0.7345 late Wednesday.
The U.S. dollar closed at 1,012.1
won, down from 1,013.5 won late Wednesday. The South Korean currency
rose slightly on suspected intervention by as foreign exchange
authorities to the tune of $1 billion to prop up the local currency.
The Australian dollar fell to a six-week low after a government report
showed that retail sales dropped the most in six years in June. The
Aussie was at US$0.9453 in late local trade, after hitting a low of
US$0.9412, down from US$0.9471 late Wednesday.
Coming back in
equity markets, the Japanese stock market closed marginally higher,
extending gains for the second straight session. Though the market
started off higher, buoyed by gains on Wall Street overnight, it turned
choppy in the afternoon session and finished slightly above the flat
line. Investors turned cautious ahead of U.S. GDP numbers.
The
benchmark Nikkei 225 index closed up 9.02 points or 0.1% at 13,376.81,
while the broader Topix index of all the Tokyo Stock Exchange First
Section issues rose 0.63 point or 0.1% to end at 1,303.62.
On
the economic front, manufacturing activity in Japan recovered modestly
in July, but remained in a state of contraction. The Nomura/JMMA Japan
Purchasing Managers Index increased by 0.5 points to a seasonally
adjusted reading of 47.0 from the June level of 46.5. The June reading
was the lowest since February 2002. The survey found that manufacturing
activity continued to be negatively impacted by a slowing economy and
rising energy costs. The report's output index, which reflects
industrial production, fell to 44.2 from 44.4 in June.
Among
other data released today, Japanese housing starts declined 16.7% in
June from the previous year, after falling 6.5% in May and 8.7% in
April, according to the Ministry of Land, Infrastructure and Transport.
Economists had forecast a sharp fall of 17.8% for June. Construction
orders received by big 50 contractors dropped 11.7% versus May's 25.2%
decline. Meanwhile, Labor cash earnings unexpectedly fell by 0.6% on
year in June, according to the Ministry of Health, Labor and Welfare.
Analysts expected a 0.6% on year increase following a revised 0.8%
annual gain in May.
The Chinese market closed lower, extending
losses for a third day. The benchmark Shanghai composite index closed
down 2.15% at 2,775.72 after losing 0.5% on Wednesday.
On the
economic arena, China's retail sales hit 864.2 billion yuan (126.7
billion U.S. dollars) in June, showing a 10-year-high growth rate of 23
percent year-on-year, the National Bureau of Statistics said on
Wednesday. The growth rate was 7.0 percentage points higher than a year
earlier and 1.4 percentage points higher than in May. Adjusted for
inflation, the June growth rate was 14.8 percent, the bureau said.
Mr.
Zhuang Jian, senior economist with the Asian Development Bank PRC
Resident Mission, attributed the faster growth rate to several factors.
These included workers' expectations of rising incomes, more allowances
for low-income earners as a result of the new labor contract law and
efforts by local governments to raise welfare payments to the needy.
Retail sales stood at 5.1 trillion yuan nationwide during the first
half, up 21.4 percent, or 12.9 percent in real terms.
In Hong Kong, the Hang Seng Index rose 0.18% to 22,731.10 and the Hang Seng China Enterprises Index gained 0.3% to 12,506.74.
The
New Zealand market closed higher for the second straight session on
Thursday. Wall Street's extended gains overnight on the back of
positive private sector employment data encouraged local investors to
look for bargain buys. The benchmark NZX 50 index closed up 48.52
points or 1.48% at 3,336.28 and the broader NZX All Capital Index rose
48.68 points or 1.44% to finish at 3,379.50.
On the economic
front, the National Bank of New Zealand said that business confidence
in New Zealand fell to a reading of -43.2 in July, easing from -38.7 in
June.
The Australian stock market closed higher today, extending
gains for a second straight session. Wall Street's gains overnight on
positive private sector employment data encouraged local investors to
buy stocks. The resources stocks gained on higher prices overnight for
copper, nickel and oil. The benchmark S&P/ASX 200 index closed up
40.7 points or 0.8% at 4,977.4 and the broader All Ordinaries index
advanced 43.9 points or 0.9% to finish at 5,052.6.
On the
economic front, a report released by the Australian Bureau of
Statistics showed that Australia's balance of trade in goods and
services moved to a surplus in June. Trade surplus was A$411 million in
June compared to a deficit of A$253 million in May. Most economists
predicted a June deficit of A$100 million. Exports fell 0.6% from May
while imports were lower by 1.0%.
Meanwhile, retail sales in
Australia dropped 1.0% in June, compared to the previous month, to a
seasonally adjusted A$20.04 billion. For the second quarter, retail
sales were down 0.6% from the previous quarter against the forecasts
had called for a 0.1% decline.
The Reserve Bank of Australia
said in a report that credit extended to the private sector in
Australia increased by a seasonally adjusted 0.4% in June from the
month before. On year-over-year basis, private sector credit increased
11.7%.
The South Korean market closed higher Thursday, extending
gains for a second day, as Wall Street's gains overnight lifted
investor sentiment. However, oil's rebound following a surprise drop in
gasoline supplies in the U.S. and a slower growth in industrial output
limited the gains. The benchmark Korea Composite Stock Price Index
closed up 16.97 points 1.08% at 1,894.67 after rising as much as 1.23%
in the first few minutes of trading.
On the economic front,
South Korea's central bank said that manufacturing confidence for
August fell to an over three-year low as companies expected Asia's
fourth-largest economy to further lose steam in the second half. The
business survey index for manufacturers' expectations declined to 74
for August, compared to 77 a month earlier. The business outlook index
has fallen to its lowest level since February 2005.
Meanwhile,
National Statistical Office said that South Korea's industrial output
grew at a slower pace of 6.7% on year in June amid lingering concerns
over surging oil prices, sluggish domestic demand and a global slowdown.
Meanwhile
the Indian market was trading in a negative territory after opening
higher in the morning. The market opened higher but pared gains
immediately amid a lack of buying interest in index heavyweights. The
bounce back seen in the price of oil in New York trading on Wednesday
is keeping investor sentiment subdued. Trading remained volatile ahead
of the expiry of July derivative contracts today. The market mood is
cautious as traders await the wholesale inflation data, which is
scheduled after the close of the market today.
After trading in
a range of 14,360-14,166, the Sensex has recouped some of its losses
ending the session at 14,355, up 68 points or 0.48% over the previous
day's close.
In the other part of the world, Europe stocks
struggled to build on gains after some disappointing earnings from BT
Group and Unilever, though oil explorers rose as crude recovered to
$126 a barrel and as Royal Dutch Shell produced the highest-ever
quarterly earnings for a European oil producer.
In the opening
trade, the German DAX 30 rose slightly to 6,4562.54, the U.K. FTSE 100
fell 0.2% to 5,407.90 and the French CAC 40 fell slightly to 4,394.54.
On
the economic front the housing prices in U.K. were down 8.1% from
year-ago levels in July as the number of housing transactions dropped
to an all-time low amid tight credit conditions and economic worries.
According
to the survey conducted by mortgage lender Nationwide the house prices
in July fell 1.7% from the previous month, marking the ninth
consecutive monthly decline. The pace of the decline accelerated from a
0.8% monthly drop in June, which left prices 6.3% below year-ago
levels.
The average price stood at 169,316 pounds ($335,120) in
July, down from 172,415 pounds in June. The average price is down by
around 15,000 pounds since July 2007, falling to its lowest level since
August 2006. House prices remain around 11,000 pounds higher than three
years ago.
The drop in transactions echoes official data from
the Bank of England that showed mortgage approvals fell to just 36,000
in June.
In another release the Consumer inflation in the euro
zone accelerated at a record annual pace of 4.1% in July ? outstripping
central bank target. Annual inflation hit 4% in June, more than twice
the European Central Bank's annual target of near but just below 2%.
In
Germany, the wholesale sales in June were down 1.5% in real terms
compared with May, but rose 2.6% year-on-year, according to preliminary
figures from the Federal Statistics Office. In May, wholesale sales
fell 0.6 percent from April and rose 0.5 percent year-on-year.
Looking
ahead the market will shift its focus on some of the key economic of
the week scheduled to be released today. The key economic event for the
day is performance of US economy in second quarter analysed by the
Gross Domestic product. It will be accompanied by the data on jobless
claims. From euro zone we are left with unemployment figure for the
region. In the evening we have personal consumption expenditure for the
second quarter followed by the Chicago?s purchasing managers index for
July.
Visit site at – http://investorline.co.in/
Newsroom - http://newsroom.investorline.co.in/
Learning Center- http://learning.investorline.co.in/
Mutual funds - http://mutualfunds.investorline.co.in/
Life Insurance - http://insurance.investorline.co.in/
Investor Journal - http://research.investorline.co.in/
Newscatcher- http://forums.investorline.co.in/
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