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Asian stocks gain on tech strength

Asian stocks gain on tech strength
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First Published: Wed, Oct 13 2010. 10 12 AM IST
Updated: Wed, Oct 13 2010. 10 12 AM IST
Singapore: Asian stocks rose on Wednesday with tech-linked shares leading the way following an upbeat fourth-quarter forecast from computer chipmaker Intel.
The dollar remained broadly weak after details of the last meeting of the US Federal Reserve suggested the central bank was closer to injecting fresh stimulus into the ailing economy.
Comments by Japan on South Korea’s leadership of the forthcoming G-20 forum underlined growing currency tensions globally. Finance minister Yoshihiko Noda questioned Seoul’s regular currency market interventions.
Intel, the world’s largest chipmaker, raised expectations for higher technology earnings in the fourth quarter by forecasting stronger sales and margins for the period. The outlook was part of its third-quarter earnings reported after the close on Wall Street.
“It’s not that Intel’s results and outlook were great, but they were modestly better than the market’s already lowered expectations,” said Lee Min-hee, an analyst at Dongbu Securities in Seoul, where the Korea Composite Stock Price Index (Kospi) was up 0.21%.
“It is such relief that is lifting technology stocks. The PC market has been showing signs of improvement since September, and key memory chip prices are expected to stabilise by the end of this year.”
Intel shares climbed 1% in after-hours trade.
In Asia, shares of Hynix Semiconductor, the world’s No. 2 memory chipmaker, rose 3% and Elpida Memory gained 0.7%.
Expectations that the US Fed is poised to bolster the economy has spurred something of a worldwide equity rally.
US stocks hit a five-month high on Tuesday. The S&P 500 index is up 11.3% since the start of September, and last month’s performance was one of the best for stocks in a decade.
MSCI’s all-country world equity index has posted a 12.1% gain since the beginning of September. The index was up 0.86% at 459.03 at ) 5:45pm.
MSCI’s Asia ex-Japan index rose 0.8%.
Hong Kong’s Hang Seng index was up 0.68% while Tokyo’s Nikkei was up 86%.
Still, the Nikkei was capped by concerns over the yen’s strength. The dollar rose 0.1% to ¥81.87, but was not far away from a 15-year low of 81.37 struck on Monday.
“The market is watching for possible Japanese intervention. But as long as the yen stays strong, the Nikkei will stay under pressure,” said Mitsushige Akino, chief fund manager at Ichiyoshi Investment Management.
The euro held on to most of its sharp gains from Tuesday, spurred by minutes of the Fed meeting on 21 September that showed central bankers thought the economy might need further support.
The euro was changing hands at $1.3965 on Wednesday, up from a low on Tuesday around $1.3771.
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First Published: Wed, Oct 13 2010. 10 12 AM IST