06 Aug 2008 | 16:03
Asian Markets Rally After Wall Street; Oil Downward Spiral Continues
The
stock markets across the Asian region were trading sharply higher,
boosted by Wall Street's rally overnight. The U.S. markets started off
higher following a positive report on service sector activity and a
fall in crude oil prices and extended their gains after the Federal
Reserve decided to leave its benchmark interest rate unchanged at 2%.
On
Wall Street, the Dow jumped 331.62 points or 2.94% to close at
11,615.77, the broader Standard & Poor's 500 index added 35.87
points or 2.87% to end at 1,284.88, and the Nasdaq composite index rose
64.27 points or 2.81% to finish at 2,349.83 on Tuesday.
Crude
prices plunged as Tropical Storm Edouard spared the key offshore rigs
along the Gulf of Mexico. The Oil fell to as low as $118 a barrel
before settling at $119.17, down $2.24 on the New York Mercantile
Exchange. Oil has now fallen $28 from its July 11 high of $147.27 on
widening expectations that the slumping U.S. economy will impact
demand. In late Asian session Wednesday, oil is currently adding 6
cents to trade at $119.23 a barrel.
In the currency market, the
dollar was quoted in the lower 108-yen levels, compared to upper
107-yen levels late Tuesday. The Australian dollar opened at near
four-month lows of US$0.9160-0.9165. The New Zealand dollar rallied
from a 10 1/2-month low of US$0.7220 against the greenback overnight
and was buying US$0.7261 in early local trade. In case of South Korean
won, the U.S. dollar finished the session at 1,015.9 won, down from
1,017.9 won late Tuesday.
Coming back in the Asian equity
market, the Japanese stock market snapped a three-day losing streak to
finish sharply higher on Wednesday. Wall Street's rally overnight amid
positive report on service sector activity, falling oil prices and the
Federal Reserve's decision to hold its benchmark interest arte at 2%
buoyed market sentiment. The Fed's strong warning on inflation weighed
on crude oil prices and kept the dollar above 108 yen, boosting
exporters.
The benchmark Nikkei 225 Index closed up 2.6% at 13,254.89 and the broader Topix Index advanced 2.4% to finish at 1,277.27.
On
the economic front, a preliminary report from the Cabinet Office showed
that the Japanese leading index dropped to 91.2 in June from 92.9
reported in May. Economists were looking for a reading of 91.1.
Meanwhile,
the coincident index stood at 101.7, in line with expectations.
However, the index fell from May's 103.3. Further, the lagging index
slid to 102.3 from 103.4 registered in May.
Chinese shares in
Shanghai and Shenzhen rebounded after suffering deep losses Tuesday.
The Shanghai Composite gained 1.1% to 2,719.37, while Shenzhen All
Share index ended little changed at 790.65 after a roller-coaster ride.
Hong
Kong financial markets were closed as an approaching cyclone brought
gale-force winds and heavy rain into the territory, prompting officials
to issue a citywide shutdown order.
The Australian stock market
closed sharply higher, ending a three-day losing streak. The benchmark
S&P/ASX 200 index closed up by 3.1% at 4,969.1 and the broader All
Ordinaries index climbed 2.8% to finish at 5,018.1.
On the
economic front, data released by the Australian Bureau of Statistics
showed that the number of housing loans for owner-occupiers dropped by
a seasonally adjusted 3.7% in June, the fifth successive month of
decline. June housing finance commitments fell by more than expected,
just a day after the Reserve Bank of Australia signaled that it was
looking to cut interest rates. Lending for investment properties
contracted 0.3% in June from a revised 6.1% slump in the previous month.
The
New Zealand market closed sharply higher on Wednesday, recouping
Tuesday's moderate losses. Wall Street's big rally overnight on the
back of positive data, a fall in oil prices and the Federal Reserve's
decision to keep the benchmark interest rate unchanged at 2% boosted
investor sentiment. The benchmark NZX 50 index closed up 1.72 % at
3,352.34 and the broader NZX All Capital Index advanced 1.35% to finish at 3,380.11.
The
South Korean market rallied after posting losses for the previous three
consecutive sessions. After starting off on a firm note, tracking a
rally on Wall Street and oil's slide overnight, the benchmark Korea
Composite Stock Price Index or Kospi closed up 2.81% at 1,578.71, its
biggest daily gain in over two weeks.
On the economic front,
South Korea's retail sales growth slowed in June as higher commodity
prices reduced consumer spending. The National Statistical Office said
that sales in South Korea's retail stores increased 6.8% year-over-year
in June, slower than the 10.1% rise seen in May. Retail sales accounted
for 20.1 trillion won, down from 21.5 trillion won in the previous
month. Excluding vehicle fuels, retail sales increased 5% over the
previous year compared to 6.4% in May.
Meanwhile, the Bank of
Korea said that South Korean money supply grew at a slower pace of
12.7% in June from the previous year. The growth eased from 14.2%
reported in May. Liquidity aggregates amounted to nearly 2,196.9
trillion won.
The Indian market is trading firm after positive
cues from the rest of the global markets, a retreat in the price of oil
and some announcements of economic reforms by the Indian government is
keeping the undertone bullish.
After opening at 15,264, the
Sensex extended its gains closing at 15,073.54, up 112.47 points or
0.75% over the previous close. The S&P CNX Nifty is closed up 15
points or 0.33%.
Elsewhere, Taiwan's Taiex surged 3.1% while
South Korea's Kospi added 2.8%. The Singapore's Straits Times Index
rose 0.9% while Thai Set index jumped by 1.8%.
In the other part
of the world the European shares declined, weighed down by losses from
the banking sector, although sharp gains from oil majors such as BP and
Eni helped place a floor under losses. At 10.50 GMT the French CAC-40
index rose 0.4% to 4,406.55
The German DAX 30 index plunged by
0.1% to 6,510.01. On the economic front the German manufacturing orders
fell a seasonally adjusted 2.9% in June from May, According to
preliminary data from the Ministry of Economics and Technology shows
revised its May figure to a month-on-month decline of 1.4 percent from
a previously announced 0.9 percent decline.
Domestic orders in
June fell by 0.6 percent, while orders from abroad dropped 5.1 percent.
Demand for capital goods fell 4.4 percent, while manufacturers of
consumer goods reported a 0.5 percent increase in orders.
Using
a two-month comparison to account for seasonal fluctuations, adjusted
manufacturing orders fell 3.7 percent in the May to June period
compared with April to May. Unadjusted June manufacturing orders fell
by 6.1 percent on a year-on-year basis.
In U.K the labor market
weakened further in July with recruitment consultancies reporting a
sharp downturn in permanent staff placements, moderating pay growth,
and a rise in staff availability. The Report on Jobs, produced by
Markit Economics and sponsored by KPMG and the Recruitment and
Employment Confederation, showed the seasonally adjusted index of
permanent staff placements fell to 44.1 in July from 48.2 in June, the
sharpest drop since December 2001. The U.K. FTSE 100 index by 0.1% to
5,450.80.
Looking ahead the day is scheduled to release data on
MBA mortgage application data for August. It will be followed by Ivy
Purchasing Managers index for the July 2008. In the evening we have EIA
Crude stock for the week ended on August 2. In the late evening we have
unemployment data from New Zealand for the second quarter, which will
be followed by the core machinery orders from Japan
.
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Asian Markets Rally After Wall Street; Oil Downward Spiral Continues
The
stock markets across the Asian region were trading sharply higher,
boosted by Wall Street's rally overnight. The U.S. markets started off
higher following a positive report on service sector activity and a
fall in crude oil prices and extended their gains after the Federal
Reserve decided to leave its benchmark interest rate unchanged at 2%.
On
Wall Street, the Dow jumped 331.62 points or 2.94% to close at
11,615.77, the broader Standard & Poor's 500 index added 35.87
points or 2.87% to end at 1,284.88, and the Nasdaq composite index rose
64.27 points or 2.81% to finish at 2,349.83 on Tuesday.
Crude
prices plunged as Tropical Storm Edouard spared the key offshore rigs
along the Gulf of Mexico. The Oil fell to as low as $118 a barrel
before settling at $119.17, down $2.24 on the New York Mercantile
Exchange. Oil has now fallen $28 from its July 11 high of $147.27 on
widening expectations that the slumping U.S. economy will impact
demand. In late Asian session Wednesday, oil is currently adding 6
cents to trade at $119.23 a barrel.
In the currency market, the
dollar was quoted in the lower 108-yen levels, compared to upper
107-yen levels late Tuesday. The Australian dollar opened at near
four-month lows of US$0.9160-0.9165. The New Zealand dollar rallied
from a 10 1/2-month low of US$0.7220 against the greenback overnight
and was buying US$0.7261 in early local trade. In case of South Korean
won, the U.S. dollar finished the session at 1,015.9 won, down from
1,017.9 won late Tuesday.
Coming back in the Asian equity
market, the Japanese stock market snapped a three-day losing streak to
finish sharply higher on Wednesday. Wall Street's rally overnight amid
positive report on service sector activity, falling oil prices and the
Federal Reserve's decision to hold its benchmark interest arte at 2%
buoyed market sentiment. The Fed's strong warning on inflation weighed
on crude oil prices and kept the dollar above 108 yen, boosting
exporters.
The benchmark Nikkei 225 Index closed up 2.6% at 13,254.89 and the broader Topix Index advanced 2.4% to finish at 1,277.27.
On
the economic front, a preliminary report from the Cabinet Office showed
that the Japanese leading index dropped to 91.2 in June from 92.9
reported in May. Economists were looking for a reading of 91.1.
Meanwhile,
the coincident index stood at 101.7, in line with expectations.
However, the index fell from May's 103.3. Further, the lagging index
slid to 102.3 from 103.4 registered in May.
Chinese shares in
Shanghai and Shenzhen rebounded after suffering deep losses Tuesday.
The Shanghai Composite gained 1.1% to 2,719.37, while Shenzhen All
Share index ended little changed at 790.65 after a roller-coaster ride.
Hong
Kong financial markets were closed as an approaching cyclone brought
gale-force winds and heavy rain into the territory, prompting officials
to issue a citywide shutdown order.
The Australian stock market
closed sharply higher, ending a three-day losing streak. The benchmark
S&P/ASX 200 index closed up by 3.1% at 4,969.1 and the broader All
Ordinaries index climbed 2.8% to finish at 5,018.1.
On the
economic front, data released by the Australian Bureau of Statistics
showed that the number of housing loans for owner-occupiers dropped by
a seasonally adjusted 3.7% in June, the fifth successive month of
decline. June housing finance commitments fell by more than expected,
just a day after the Reserve Bank of Australia signaled that it was
looking to cut interest rates. Lending for investment properties
contracted 0.3% in June from a revised 6.1% slump in the previous month.
The
New Zealand market closed sharply higher on Wednesday, recouping
Tuesday's moderate losses. Wall Street's big rally overnight on the
back of positive data, a fall in oil prices and the Federal Reserve's
decision to keep the benchmark interest rate unchanged at 2% boosted
investor sentiment. The benchmark NZX 50 index closed up 1.72 % at
3,352.34 and the broader NZX All Capital Index advanced 1.35% to finish at 3,380.11.
The
South Korean market rallied after posting losses for the previous three
consecutive sessions. After starting off on a firm note, tracking a
rally on Wall Street and oil's slide overnight, the benchmark Korea
Composite Stock Price Index or Kospi closed up 2.81% at 1,578.71, its
biggest daily gain in over two weeks.
On the economic front,
South Korea's retail sales growth slowed in June as higher commodity
prices reduced consumer spending. The National Statistical Office said
that sales in South Korea's retail stores increased 6.8% year-over-year
in June, slower than the 10.1% rise seen in May. Retail sales accounted
for 20.1 trillion won, down from 21.5 trillion won in the previous
month. Excluding vehicle fuels, retail sales increased 5% over the
previous year compared to 6.4% in May.
Meanwhile, the Bank of
Korea said that South Korean money supply grew at a slower pace of
12.7% in June from the previous year. The growth eased from 14.2%
reported in May. Liquidity aggregates amounted to nearly 2,196.9
trillion won.
The Indian market is trading firm after positive
cues from the rest of the global markets, a retreat in the price of oil
and some announcements of economic reforms by the Indian government is
keeping the undertone bullish.
After opening at 15,264, the
Sensex extended its gains closing at 15,073.54, up 112.47 points or
0.75% over the previous close. The S&P CNX Nifty is closed up 15
points or 0.33%.
Elsewhere, Taiwan's Taiex surged 3.1% while
South Korea's Kospi added 2.8%. The Singapore's Straits Times Index
rose 0.9% while Thai Set index jumped by 1.8%.
In the other part
of the world the European shares declined, weighed down by losses from
the banking sector, although sharp gains from oil majors such as BP and
Eni helped place a floor under losses. At 10.50 GMT the French CAC-40
index rose 0.4% to 4,406.55
The German DAX 30 index plunged by
0.1% to 6,510.01. On the economic front the German manufacturing orders
fell a seasonally adjusted 2.9% in June from May, According to
preliminary data from the Ministry of Economics and Technology shows
revised its May figure to a month-on-month decline of 1.4 percent from
a previously announced 0.9 percent decline.
Domestic orders in
June fell by 0.6 percent, while orders from abroad dropped 5.1 percent.
Demand for capital goods fell 4.4 percent, while manufacturers of
consumer goods reported a 0.5 percent increase in orders.
Using
a two-month comparison to account for seasonal fluctuations, adjusted
manufacturing orders fell 3.7 percent in the May to June period
compared with April to May. Unadjusted June manufacturing orders fell
by 6.1 percent on a year-on-year basis.
In U.K the labor market
weakened further in July with recruitment consultancies reporting a
sharp downturn in permanent staff placements, moderating pay growth,
and a rise in staff availability. The Report on Jobs, produced by
Markit Economics and sponsored by KPMG and the Recruitment and
Employment Confederation, showed the seasonally adjusted index of
permanent staff placements fell to 44.1 in July from 48.2 in June, the
sharpest drop since December 2001. The U.K. FTSE 100 index by 0.1% to
5,450.80.
Looking ahead the day is scheduled to release data on
MBA mortgage application data for August. It will be followed by Ivy
Purchasing Managers index for the July 2008. In the evening we have EIA
Crude stock for the week ended on August 2. In the late evening we have
unemployment data from New Zealand for the second quarter, which will
be followed by the core machinery orders from Japan
.
Visit our site at – http://investorline.co.in/
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Latest News - http://investorline.co.in/blogger/?q=aggregator/categories/1
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