×
Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday
×

Asia shares rises tracking US; tech stocks up

Asia shares rises tracking US; tech stocks up
Comment E-mail Print Share
First Published: Thu, Jan 28 2010. 09 56 AM IST
Updated: Thu, Jan 28 2010. 09 56 AM IST
Hong Kong: The US dollar rose to a six-month high against the euro on Thursday, on signs the Federal Reserve is more confident about a recovery, while Asian equities were on track to snap a nine-day losing streak.
US stock futures rose during Asian session after US President Barack Obama in an address to Congress had a more moderate tone on restrictions toward US banks.
Obama also promised to double exports in the next five years.
In a positive development for risk taking, technology shares, which have been leading the broader Asian market lower, reversed course and were up nearly 1% across the region, supported by the outlook for earnings.
US Treasuries were steady, holding most of the gains in shorter-maturity yields after a Fed policy meeting overnight. One hawkish Fed member surprised the market by dissenting to a decision to remove a phrase from a statement saying rates would be kept low for an “extended period.”
“Tt seems like it is going to be a mixed picture ahead,” said economists with United Overseas Bank in a note.
“There would be some in the markets convinced that the Fed will keep rates low for an extended period; yet on the other hand, there will be a handful taking signals that within the Fed, a gradual movement towards a more normal monetary policy stance, perhaps, is starting to emerge.”
The euro fell to a low below $1.3940 before cutting losses to $1.4000, while the ICE US dollar index, which measures its performance against six major currencies, was up 0.2%, after earlier hitting the higest since September 2009.
The yield on the 2-year US Treasury note was steady at around 0.9185% after jumping 11 basis points overnight.
The spread of the benchmark 2-year euro zone government bond yield over the 2-year US yield narrowed to 24 basis points, the smallest so far in January, after dropping 6 basis points on Wednesday.
The MSCI index of Asia Pacific stocks outside Japan was up 0.4% though was still down 5.5% so far in January.
The tech sector was providing the biggest support to the index, rising 1.3%. The sector has had the biggest upgrades in earnings estimates of any other segment over the last 30 days, up 4.6%, while valuations have actually contracted in the period.
Japan’s Nikkei share average was up 1.3%, helped by reports of robust earnings growth from Honda Motor Co, whose stock jumped 4.9%.
Shares of Toyota Motor Co extended a decline to 13% over the past week after having to suspend sales of some best-selling vehicles in the US market because of safety issues.
The stronger US dollar weighed on raw materials prices. Copper traded in Shanghai was down 3.6%, after three-month copper on the London Metal Exchange dropped around 4.7% on Wednesday.
Comment E-mail Print Share
First Published: Thu, Jan 28 2010. 09 56 AM IST
More Topics: Markets | Global | Asia | Nikkei | Hang Seng |