Hong Kong: Asian markets continued their trend upwards for a fourth straight week on Friday as confidence was lifted by an agreement by world leaders at the Group of Twenty (G-20) summit.
Upward trend: A woman walks past a stock index board in Tokyo on Thursday. The Nikkei continued to head north, up 4.4% on Friday. Kim Kyung-Hoon / Reuters
The talks in London on Thursday saw the 20 leading developed and developing nations pledge at least a trillion dollars in new money to help poorer countries and lift the world out of an economic tailspin.
The move also saw the dollar rise above 100 yen for the first time in five months, helping exporters in Japan.
The region was also reacting to a 2.79% jump on Wall Street following the G-20 announcement and the first pieces of positive manufacturing data from China and the US for several months.
Further gains were tempered by profit-taking following heavy gains on Thursday, which saw Hong Kong rise 7.41% and Tokyo 4.40%.
However, the current market recovery is being driven purely by market hopes, said Tachibana Securities strategist Kenichi Hirano.
“People may wake up when US financials and Japanese manufacturers report earnings later this month,” Hirano told Dow Jones Newswires.
Global stocks have soared over the past four weeks following a number of stimulus measures by governments and a pledge by Washington to help banks clear their books of toxic assets that had clogged lending.
Tokyo’s Nikkei-225 index climbed 30.06 points to 8,749.84. Shares rose to the highest level since 9 January.
Exporters got a lift from a weaker yen, which fell to a five-month low against the dollar, although the overall market’s gains were capped by profit-taking after the previous day’s surge.
The Nikkei has rallied about 24% from a 26-year closing low of 7,054.98 points seen on 10 March.
Toyota Motor Corp. climbed 7.2% to 3,700 yen and Honda Motor Co. Ltd gained 1.6% to 2,780 yen. Sony Corp.advanced 3.2% to 2,395 yen andToshiba Corp. added 2.1% to 298 yen.
The Hang Seng Index closed up 23.72 points at 14,545.69. But the gains were limited as many investors took profit following a 7.41% jump in the index on Thursday.
Ernie Hon, a strategist at ICEA Securities, said he expected the market’s near-term outlook to be positive. But Wilson Wong, an analyst at Taifook Securities, was more cautious. “Investors should watch out as the market appears to be running out of positive news to further sustain the strong rally of late,” he said.
HK Exchanges, the local bourse operator, jumped 5.1% to 83.85 dollars on strong turnover on the index.
Hong Kong and Shanghai Banking Corp. Ltd rose 0.1% to $49.45, following a 15.3% advance on Thursday, on hopes the US economic downturn is bottoming out. China Shipping Container Lines Co. Ltd advanced 11.2% to $1.78.
The S&P/ASX 200 in Sydney closed up 55.4 points at 3,735.6. Banking stocks in particular were boosted by changes to the way they viewed toxic assets under US financial accounting standards, said IG Markets analyst Ben Potter.
“Potentially, this change in accounting standards could see as much as 20% added to earnings in the second quarter for US banks,” said Potter.
ANZ Banking Group added 6.49% to 17.40 and National Australia Bank lifted 6.23%to 22.84.
Macquarie Group, Australia’s largest investment bank, gained 4.54% to 29.45. BHP Billiton Ltd rose 3.65% to 34.60, while Rio Tinto Plc. put on 4.21% to 60.40. Qantas Airways Ltd picked up 2.21% to 1.85, while telco Telstra fell 2.85 to 3.07.
The Shanghai Composite Index, which covers A and B shares, was down 5.51 points at 2,419.78, down 0.23%.
“Given how much Chinese stocks have risen already, they didn’t perform too badly today,” Chen Jinren, an analyst with Huatai Securities said.
Zijin Mining Group dropped 4.3% to 10.36 yuan while Western Mining ended down 4.7 % at 12.40 yuan. Bank of Communications, China’s fifth largest bank by assets, ended up 4.1% at 6.89 yuan.
Taipei’s weighted index was up 1.02%, rising 55.85 points to 5,529.63.
The market opened higher as investors took cues from the Wall Street gains and the momentum continued until the end of the session with financial stocks in focus, dealers said.
Fubon Financial added 6.87% to $24.10. The construction sector benefited from adequate liquidity on hopes for an auction of a property in Taipei, dealers said.
Taiwan Semiconductor Manufacturing Co. Ltd gained 0.38% to 52.60 and United Microelectronics Corp. rose 0.88% to 11.40.
The Kospi in Seoul was up 0.53%, gaining 6.78 points to close at 1,283.75.
“Improving economic data and overnight gains in offshore markets lent support to the market,” Kim Hak-Kyoon, a Korea Investment and Securities analyst, said.
Analysts said market participants have not reacted much to a planned rocket launch by North Korea, treating it as a short-term event.
Shinhan Financial Group rose 4.1% to 28,900 won and Hyundai Motor Co. rose 1.3% to 61,500 won. Hynix Semiconductor Inc. fell 0.8% to 12,600 won.
In Singapore, the Straits Times Index rose 17.53 points to 1,820.87, up 0.97%.
“Basically, we have a more bullish tone, cautious...but not as bleak as before,” said one trader.
United Overseas Bank rose 20 cents to 10.68 and DBS Bank Ltd was up two cents at 9.02. Singapore Airlines Ltd gained eight cents to 10.64 while Singapore Telecommunications Ltd eased five cents to 2.50.