Friday, August 28, 2015

Asia: Stocks up for second day on US growth

Asia: Stocks up for second day on US growth  

[HONG KONG] Tokyo shares led Asian stock markets higher on Friday after a surprisingly upbeat US economic growth report buoyed investors following a prolonged rout driven by concerns over China's economy.
The dollar gained and oil prices rose on the back of the US growth report, while the yen came under pressure from data showing Japan's inflation was flat last month.
Tokyo stocks finished 3.03 per cent, or 561.88 points, higher at 19,136.32, while Shanghai gained 4.82 per cent, or 148.76 points, to 3,232.35.
Sydney closed 0.58 per cent, or 30.30 points, higher at 5,263.60, and Seoul gained 1.56 per cent, or 29.67 points, to finish at 1,937.67.
Hong Kong was the lone faller, with the benchmark Hang Seng Index dropping 1.04 per cent, or 226.15 points, to 21,612.39.
The gains in Asia followed a second straight day of advances on Wall Street, with the Dow Jones Industrial Average gaining 2.27 per cent, the broad-based S&P 500 rising 2.43 per cent and the tech-rich Nasdaq adding 2.45 per cent.
They were boosted by a US economic growth report that showed the world's biggest economy expanded at an annual rate of 3.7 per cent in the second quarter, sharply higher than the initial appraisal of a 2.3 per cent gain.
"Fear for the global economy had been one reason behind the recent falls, so the unexpected strength in the US, the fact that their GDP has managed to grow this much, is positive," said Nobuyuki Fujimoto, a Tokyo-based senior market analyst at SBI Securities Co.
The gains come as a relief to investors who saw US$8 trillion wiped off global markets in just over two weeks in a rout led by fears over the outlook for China.
Oil prices fell back after surging 10 per cent in the previous session on the back of the US data.
US benchmark West Texas Intermediate dropped 40 US cents to US$42.16 while Brent crude fell 53 US cents to US$47.03.
On currency markets, the dollar was trading around one-week highs against the euro and the yen.
The Japanese currency was also hurt by data showing inflation in the Asian powerhouse fell back to zero in July while household spending dropped for a second straight month.
The disappointing figures stoked speculation the central bank would be forced to unleash more stimulus this year to counter a downturn in the world's number three economy, which contracted in the April-June quarter.
In Tokyo trading, the dollar bought 120.86 yen, from 121.02 in New York and 119.98 on Wednesday.
It was also at US$1.1297 against the euro, down from US$1.1239 in New York but still stronger than Wednesday's value of US$1.1312. The euro bought 136.54 yen, against 136.03 yen in US trading.
Gold, which is seen as a safe haven in times of stock market turmoil, traded at US$1,130.38, up from US$1,125.00.
BLOOMBERG

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