Asian markets look up on Wall Street rally

Asian markets look up on Wall Street rally
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First Published: Thu, Jul 10 2008. 01 13 AM IST
Updated: Thu, Jul 10 2008. 01 13 AM IST
Hong Kong: Asian markets rose on Wednesday, helped by an overnight rally on Wall Street, lower oil prices and better-than-expected earnings reports in China.
Most benchmarks closed higher but South Korea stocks slipped and Taiwan’s market ended flat.
In Japan, the benchmark Nikkei 225 index rose about 0.2% to 13,052.13. Its 12-day losing streak, the longest in 54 years, just ended on Monday. Better-than-expected machinery orders improved sentiment, but overall gains were limited as investors turned jittery over a report on Iran’s missile tests.
Chinese shares rose for a third day as investors bought insurers and real estate developers. Strong corporate earnings report and expectations that inflation will ease were the primary reasons.
The benchmark Shanghai Composite Index climbed 3.8% to 2,920.55. Investors were encouraged by expectations that data due to be released shortly will show lower inflation in June, which would ease pressure for an interest rate hike, said Zhang Yang, a strategist for Oriental Securities.
Chinese stock prices have been battered by worries about inflation, a possible hike in interest rates and high oil prices. Despite this week’s rise, the Shanghai index is still down 52% from its record high in October. “The fall of the market before was overdue. Today’s rise was just a correction for the sharp fall,” said strategist Qian Qimin at Shenyin and Wanguo Securities.
China Petroleum and Chemical Co., also known as Sinopec, Asia’s biggest refiner by volume, rose 4.8% after crude futures fell more than $5 (Rs215) on Tuesday. PetroChina Ltd, China’s biggest oil producer, rose 3.24%. Aside from oil’s retreat, Wall Street’s gains cheered Asian investors. US markets rose amid encouraging signs of more help for the ailing financial system. The Dow Jones Industrial Average closed more than 150 points higher, a gain of about 1.4%.
The US and China markets boosted Hong Kong, where the blue-chip Hang Seng Index rose 2.8% to 21,805.81. The index lost 3.2% on Tuesday.
AP
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First Published: Thu, Jul 10 2008. 01 13 AM IST