Stock markets in Asian region managed a turnaround on Friday 13 February 2009, on hopesthat government efforts worldwide, including talk of a U.S. subsidy for mortgage payments,would soften the blow of the global downturn. The improved mood among global investorscomes ahead of this weekend's G7 meeting of financial leaders, though little in terms ofactual policy is expected to emerge.
Wall Street managed to trim all their losses at the end of the day after a word that theObama administration is working on a plan to subsidize mortgage payments for troubledhomeowners spurred a late rebound in the major indices. The Dow Jones Industrial Averageended lower by 6.7 points at 7,932, the Nasdaq closed higher by 11.2 points at 1,541 andthe S&P 500 closed higher by 1.4 points at 835. The Dow had dropped 215 points earlierduring the day.
Among major economic news today, Jobless claims for the week ending 7 February, 2009totaled 623,000, which is a bit more than expected, but down slightly from the prior week.Continuing claims stand at 4.81 million. Both initial claims and continuing claims standat multiyear highs and reflect ongoing layoffs and challenging job conditions.
On the other hand, retailers registered an increase in sales after quite a long time on ayearly basis. Sales in January registered 1% increase, which witnessed an increase afterseven months of drop.
In the commodity market, crude oil rose in New York, paring the worst weekly decline sinceDecember, after equities gained on speculation governments will widen efforts to helpconsumers weather a deepening global recession.
Crude oil for March delivery rose as much as 57 cents to $34.55 a barrel on the New YorkMercantile Exchange. It was at $34.55 a barrel at 7:55 a.m. London time. Yesterday,futures fell $1.96, or 5.5%, to $33.98 a barrel, the lowest settlement since 19 December2009. It was the fifth consecutive daily decline.
Brent for March settlement climbed 10 cents, or 0.10%, to $46.07 a barrel on London’sICE Futures Europe exchange. March futures expired yesterday. The new prompt month Aprilcontract was at $46.10 a barrel, up 7 cents, at 7:55 a.m. London time. The contract gained71 cents, or 1.6%, yesterday to close at $46.03 a barrel.
Gold prices dropped $10.20 an ounce, or 1.07%, to $939 in Asian electronic trading onFriday after the most active April Comex gold contract rose to $949.20, up $4.70 on thesession. Earlier, prices hit as high as $954.00, its highest mark since July. The metalhas gained more than $55 in a two-day rally.
In the currency market, the Japanese yen weakened against the dollar. The Japanese yen wasquoted at 91.58 against the US dollar, down from yesterday’s quote of 91.2300 yen.
The Hong Kong dollar was trading at HK$ 7.7531 against the dollar. Actually The Hong Kongdollar is pegged at HK$ 7.8 to the U.S. dollar but can trade between HK$ 7.75 and HK$7.85to the U.S. dollar.
In Sydney trades, the Australian dollar gained after the government approved a A$41.5billion ($27 billion) fiscal stimulus package. The Australian dollar closed the day atUS$0.6474, up from Thursday's close of US$0.6580.
In Wellington trades, the NZ dollar ended at US52.45c from US52.58c yesterday. Thecurrency fell a cent to US51.70c during a two-hour period on Thursday night.
The U.S. dollar was lower against the New Taiwan dollar in Taipei today. The New Taiwandollar closed the day at NT$ 34.050 against greenback, up NT$0.025 from Thursday’sclosing of NT$ 34.025.
Coming back in Asian equities, stock markets in Japan, snapped their three days of losingstreak helped by short covering and gains in export scrip following the weakening of theyen relative to the U.S. dollar. The Nikkei 225 index closed at 7,779, up 74 points or0.96%, while the broader Topix index of all First Section issues on the Tokyo StockExchange rose 4.30 points or 0.57% to 764.59.
On the economic front, Japanese investors purchased a net 590.0 billion yen in foreignbonds last week, the Ministry of Finance said on Friday. Japanese residents also bought anet 335.8 billion yen in foreign stocks, the ministry said. Foreigners sold a net 270.5billion yen in Japanese bonds last week, and sold a net 277.3 billion yen in Japanesestocks.
In Mainland China, the stock indices snapped its two days of losses finishing the sessionat five-month closing high in very heavy trade on Friday as speculative money continued topour into the market. The real estate sector was particularly strong. The ShanghaiComposite Index rose sharply to end at 2,320.79 points i.e. 72.70 points or 3.62% higher.
In Hong Kong, the markets continued to obey the Shanghai closing as it blue chip stockssurged after a two-day slump on talk of a U.S. subsidy for mortgage loans, while Chinesecounters tracked strong gains on the Shanghai bourse. The Hang Seng Index jumped 326.37points, or 2.47%, to 13,554.67, while the Hang Seng China Enterprise Index gained 201.17points, or 2.73% to 7,568.73.
In Australia, stock market finished the session higher, thanks to deal made in the upperhouse of Australian Senate over the $42 billion stimulus package. The deal helped thefinancial stocks to lead the market gains. Consumer discretionary stocks supported thelead with equal gain. The benchmark S&P/ASX200 climbed up 44.80 points, or 1.30%, to3,559.10, while the broader All Ordinaries added 38.20 points, or 1.10%, to 3,496.70. In aweek, the S&P/ASX200 has gained 89.20 points, or 2.57%, while All Ordinaries added89.20 points, or 2.61%.
On the economic front, the upper house of Australian Senate has passed the $42 billionstimulus package after week of drawn-out negotiations between the Government andcrossbenchers. The Senate voted 30-28 to approve the package. The package includesspending of A$28.8 billion on schools, housing and roads over four years, tax breaks forsmall businesses and cash handouts of A$12.7 billion to eligible workers, farmers andstudents. The package will now go back to parliament's lower house, where the Governmenthas a strong majority before it becomes law.
In New Zealand, stock markets ended flat as the benchmark index dipped during the firstthree days of the week on pessimism on Wall Street to end the last two days in thepositive territory. The benchmark NZX50 ended up at 0.02% or 0.628 points to close at2750.774. The NZX 15 was up 0.08% or 4.052 points to 5099.115.
On the economic front, New Zealand's seasonally adjusted value of total retail sales fell1.1% ($179 million) in the December 2008 quarter, Statistics New Zealand said on Friday,13 February 2009. This is the biggest quarterly fall since March 1997, when sales fell1.6%. In December 2008, seasonally adjusted total retail sales fell 1.0% ($57 million).The biggest decrease was in automotive fuel retailing, down 8.4% ($47 million), and thebiggest increase in motor vehicle retailing, up 2.9% ($17 million). Core retailing fell0.6% ($25 million) with sales in half of the core industries decreasing and halfincreasing.
In other economic news, the Real Estate Institute of New Zealand, or REINZ, said housesales in January was the lowest since 1992. The number of home sales nationwide was 3,706in January, significantly less than 5,186 recorded in the same period of 2008 and 4,302sold in December. REINZ said the very limited turnover was of greater concern than prices.
In South Korea, the benchmark Kospi reversed its early losses to close at 1,192, up 13points or 1.07% on institutional buying. Auto, technology and banking stocks were theprominent gainers.
In Philippines, the equity market ended slightly lower, recording a weekly loss asinvestors displayed uncertain sentiments amid of steady global cues. The benchmark PSEiindex hovering in a range of 1940.69 - 1919.62 and closing the day at 1919.66, down about4 points or 0.23% from the previous close and shedding 1.18% on a weekly basis.
In Taiwan, stock market sprang 2.8%, as a late Wall Street rally actuated buying in thetechnology stocks including Acer who booked losses in the fourth quarter. The LCD makersand broad based advance in financial stocks also supported the gains. The main Taiex shareindex jumped 126.08 points or 2.82% to 4592.50, the highest closing since 7 January 2009when market closed at 4789.84. It was the biggest percentage gain since 30 December 2008when market soared by 3.9%.
In India, profit booking in late trade cut sharp early gains in key benchmark indices.Strong global cues and US index futures data which showed the Dow could gain 23 points atopening bell bolstered the sentiment with bourses exhibiting strength throughout the day.
The BSE 30-share Sensex provisionally rose 151.24 points or 1.60%, off 42.52 points fromthe day's high. The BSE 30-share Sensex rose 151.24 points, or 1.60%, to 9,617.07, as perprovisional closing. The Sensex opened points 74.77 higher at 9,540.60, also its day'slow. At the day's high of 9,695.59, the Sensex gained 229.76 points in mid-afternoontrade. The S&P CNX Nifty advanced 47.25 points, or 1.63%, to 2,940.30 as perprovisional closing
Elsewhere, Malaysia's Kula Lumpur Composite index was up 1.70% or 15.24 points to 909.84,while Indonesia’s Jakarta composite increased by 13.32 points or 1.01% to 1,338.74.In Thailand, the Thai Stock exchange gained 5.14 points or 1.17% to 445.77. In Singaporethe Strait Times added 20.68 points or 1.23% to 1705.64.
In other regional market, European shares rose for the first time in four sessions onFriday, as banks advanced and an uptick in crude-oil futures helped oil producers toclimb. Overall, the U.K. FTSE 100 index rose 1.5% to 4,265.22, the German DAX 30 indexclimbed 1.5% to 4,474.92 and the French CAC-40 index advanced 2% to 3,024.48.
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