BackAsia stocks climb as investors weigh Fed comments; Sinopec gains
The MSCI Asia Pacific Index added 0.1% to 148.71, within a point of a six-year high reached last month
Premium
Sydney: Asian stocks rose, extending back-to-back weekly gains, as investors weighed earnings reports and comments from central bankers for clues to monetary policy.
Caltex Australia Ltd soared 7.4% after the Australian oil refiner said it plans to cut 350 jobs and raised its interim dividend more than analyst had forecast. China Petroleum and Chemical Corp. surged 4.3% in Hong Kong as earnings at Asia’s biggest refiner were better than expected. Chugai Pharmaceutical Co. slumped 9.2% after a person familiar with the matter said Roche Holding AG will decide against bidding for the almost 40% of the Japanese drug maker that it doesn’t already own.
The MSCI Asia Pacific Index added 0.1% to 148.71 as of 7.12pm in Hong Kong, within a point of a six-year high reached last month. Slack remains in the US labour market, though interest rates could be raised sooner than expected, Federal Reserve Chair Janet Yellen said in Jackson Hole, Wyoming, on 22 August. European Central Bank president Mario Draghi committed to more stimulus.
“The Fed doesn’t want to run too fast in trying to tighten things up," Angus Gluskie, managing director at White Funds Management in Sydney, where he helps oversee about $550 million, said by phone. “They still see their employment improving but improving slowly rather than being robust. They recognize they have to normalize rates at some point and they can’t leave them hanging out here at these low levels forever, so they are continuing to flag that to markets and that’s the status quo."
Regional gauges
Hong Kong’s Hang Seng Index gained 0.2% and the Hang Seng China Enterprises Index of mainland stocks listed in the city climbed 0.5%. The Shanghai Composite Index declined 0.5% as concern that new bank lending isn’t picking up overshadowed a rally for airlines.
Japan’s Topix index rose 0.4% with Toyota Motor Corp., the world’s largest car maker, providing the biggest boost to the measure. Toyota rose 0.7% to 5,985 yen. Trading in Japan was 21% below its 30-day average.
South Korea’s Kospi index gained 0.2% and New Zealand’s NZX 50 Index advanced 0.3%. India’s S&P BSE Sensex Index rose 0.1% and Singapore’s Straits Times Index added 0.1%. Taiwan’s Taiex index also rose 0.1%, while Australia’s S&P/ASX 200 Index declined 0.2%. Caltex climbed 7.4% to A$27.45.
Futures on the Standard & Poor’s 500 Index added 0.3% after a technical fault delayed the open of CME Group Inc.’s Globex electronic-trading platform.
US jobs
In her address at the Fed Bank of Kansas City symposium, which hosted central bankers from around the world, Yellen said that there was still a significant underuse of the US workforce and the job market has yet to recover from the global financial crisis. She did, however, acknowledge the need for flexibility, saying if progress continues to be more rapid than anticipated, a rate rise could come sooner than currently expected and further increases could be more rapid.
Draghi, who is striving to avoid deflation and ignite euro-area economic growth, said ECB policy makers “stand ready to adjust our policy stance further." He said the bank’s governing council will use all available instruments to “ensure price stability over the medium term." Draghi has previously said the ECB may carry out broad asset purchases, or quantitative easing, should the inflation outlook worsen.
Bank of Japan Governor Haruhiko Kuroda said at the symposium that his nation’s monetary policy was “having its intended effect" and that central banks must fight deflation by any and all means. He said Japan should consider using foreign workers to help mitigate labour-force shortages.
China Petroleum and Chemical, known as Sinopec, surged 4.3% to HK$8.04 after posting a better-than-expected 7.5% increase in first-half profit, widening the margin it earns from processing crude oil into fuels.
Chugai sank 9.2% to 3,325 yen. Roche decided not to bid for the almost 40% of the Japanese drug maker that it doesn’t already own and instead focus on its $8.3 billion acquisition of InterMune Inc., according to a person familiar with the matter. Bloomberg
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!
