Asia Pacific share markets wrapped Tuesday's trading session broadly higher, with the MSCI Asia Pacific Index rose 0.9% to 132.53, as appetite for riskier assets continued to be supported by expectations the global economic recovery was gaining momentum.
Risk sentiments propelled after reports from Germany to Australia to South Korea signaled improved global sentiment. Official data from Germany showed consumers became more confident at the start of 2013. The GfK consumer-climate study improved to 5.8-points forecast for February, up from 5.7 points in January.
The National Australia Bank survey data showed Australian business confidence rebounded sharply in December, with the business confidence index climbed to 3 in December from -9 in November, thanks to lower interest rates, the fiscal cliff deal in the U.S. and signs of an economic recovery in China.
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Meanwhile, the Bank of Korea monthly survey data showed that an index measuring South Korean manufacturers' business confidence for February increased to 72 from 70 in January.
In the Asia Pacific region, key benchmark indices in Taiwan, China, Indonesia, Japan and South Korea rose by 0.39% to 1.13%. Key benchmark indices in India, Hong Kong, New Zealand, and Singapore fell by 0.07% to 0.56%. Japan stocks boosted by a solid rally in banks, Australia's market capped its longest rising streak since 2004 and Korean shares rebounded from yesterday's loss. Hong Kong shares lagged behind, weighed by Industrial & Commercial Bank of China after Goldman Sachs Group Inc pared its stake in the lender, while Chinese market retreated from recent gains. Indian market declined after the RBI lowered its key policy rate, but struck a cautious note on further easing.
Back to country wise, Tokyo market closed modest higher on Tuesday, January 29, 2013, as investors chased for bargain buying on earnings optimism, thanks to yen's weakness against major currencies. The benchmark Nikkei Stock Average advanced 42.41 points from prior day closure to 10,866.72 while the broader Topix index jumped 6.98 points at 920.76.
The advance in Japan came as earnings optimism in the banking sector after Nikkei reported that the recent rally for the Japanese market will lift profits at the banks, which are shareholders in some of the companies that have seen sharp share price gains. Banks and financials were sharp higher today, with Sumitomo Mitsui Financial Group Inc jumped 4.4% to 3,450 yen, Mitsubishi UFJ Financial Group Inc 3.8% to 497 yen, and Mizuho Financial Group Inc 2.9% to 175 yen.
KDDI Corp rose 2.8% to 6,530 yen after the firm reported late Monday that its profit in the fiscal third-quarter nearly doubled from a year earlier thanks to strong sales of smartphones, including Apple's iPhone. The country's second-biggest mobile firm said it earned 100.49 billion yen, up from 54.22 billion yen a year earlier, while logging a 7.5% increase in revenue to 969.98 billion yen.
Japanese Prime Minister Shinzo Abe's cabinet approved Tuesday a record 92.6 trillion yen ($1 trillion) draft budget for fiscal 2013, as efforts to rein in the nation's deficit take a back seat to the new administration's goal of quickly boosting the economy. In addition to a major expansion of public works spending, the on-year increase in the proposed budget reflects the difficulty of reining in an aging nation's social welfare expenditure and Mr. Abe's renewed emphasis on defense, which is set for its first funding increase in 11 years amid ongoing tensions with China.
The Japanese government on Monday unveiled its growth forecast for the fiscal year starting in April, saying the economy was on track to expand 2.5% thanks to fresh stimulus and a recovery in key overseas markets.
In Australia, Sydney share market wrapped first session of the shortened week solidly higher today, registering ninth day of straight gain, on the back of risk appetite buying across the board, with financials, telecom, and healthcare led advancers. Australia's market was closed on Monday for public holiday. At closing, the benchmark S&P/ASX200 index jumped 53.8 points, or 1.1%, higher to a new 21-month high of 4889.0, while the broader All Ordinaries added 52 points, or 1.1%, to 4910.9.
Every sector measured by the ASX registered solid gains, led by the financial sector, which added 1.3%. Defensive sectors such as health and telco posted strong gains, rising 2.5% and 1.9% respectively. Materials underperformed adding just 0.2%, while the gold sector slumped 2.6%. In the financial sector, the big four banks all rallied, with Westpac rose 2.4% to A$28.22, Commonwealth Bank 1.8% to A$64.73, National Australia Bank 1.8% to A$27.72, and ANZ 1.7% to A$26.51.
Australian insurance stocks suffered predictable pressure after flood events in many jurisdictions on the east coast lodged more than 10,000 claims and the damage bill set to rise above A$100 million. Suncorp descended 1.9% to A$10.70 as it said it had so far received about 4500 claims and expects more to come as floodwaters in some areas of Queensland and NSW yet to peak. QBE dropped 2.7% to A$11.28. Insurance Australia Group nudged up 0.2% to A$4.93, erasing earlier falls. IAG has received about 2,000 claims related to floods and storms in Queensland and NSW, but says the situation is in its early stages.
In New Zealand, the Auckland fell slightly after briefly hitting a five year high, with some analysts claiming there's case for New Zealand equities to go higher if the forthcoming earnings season surprises with stronger than expected results. The NZX50 Index of leading stocks was down 4.148 points, of 0.99%, at 4,200.289. Among losers on the day was Fonterra Shareholders Fund, which dropped another 1.12% to NZ$7.05, its lowest point since Dec 18, as the world's largest dairy exporter continued to deal with the fallout from the discovery of minute traces of a nitrate inhibitor, known as DCD, in milk powder products.
Kiwi jumped strongly after trade balance unexpectedly showed NZ$486 million surplus in December comparing to expectation of NZ$105 million deficit. That was indeed the largest surplus figure since 1991. Imports dropped -19% from a month earlier to NZ$3.58 billion comparing to a solid 6.2% rise in exports to NZ$4.07 billion. And the large fall in imports was seen as mainly due to a crop in crude oil imports and thus, was not taken as a sign of domestic demand weakness.
In South Korea, Seoul shares rose notably as investors went bargain hunting following four consecutive days of losses. The benchmark Kospi average rose 0.8%, with heavyweight Samsung Electronics climbing 2.7% after the won turned weaker against both the dollar and the yen. Automaker Hyundai Motor soared 4% and its affiliate Kia Motors added 5.1%.
In China, Late hour rally in the blue chips on speculation the securities regulator will put off new initial public offerings to boost market confidence, buoyed up key Chinese indices to finish the day with positive tone on Tuesday, January 29, 2013. The benchmark Shanghai Composite index escalated 12.47 points from prior day closure to 2,358.98, while the Shenzhen Composite Index rose 8.67 points to 941.28. However, gains on the upside was limited slight higher, as investors favored for limited risk amidst cautious ahead of key economic numbers later this week. Risk sentiments also muted on worried about market overheating after the benchmark surged to the highest level in seven months after falling to four-year low on Dec. 3, 2012.
Coal stocks registered notable gain in China today, helped by gains in crude oil prices overnight. Shanxi Lu'an Environmental Energy Development Co advanced 3.1% to 22.56 yuan, Yanzhou Coal Mining Co 1.4% to 18.23 yuan, and China Coal 1.4% to 7.99 yuan. Shares of financials players were also higher in Mainland China, led by brokerage houses on reports Shanghai stock exchange bourse will expand the number of stocks allowable for margin trading and short selling to 300 from Jan. 31 and Shenzhen will increase the number to 200 from 98. Among brokerage companies, Citic Securities, the largest-listed brokerage, jumped 4.3% to 14.96 yuan. Haitong Securities Co., the second-biggest, rose 7.2% to 11.81 yuan.
In Hong Kong, HK share market ended with soft note after moving narrow range, as weakness in realty and financials were offset by gains in utilities and resources heavyweights. The benchmark indices consolidating at current level ahead of future contract settlement. The benchmark Hang Seng index declined 16.71 points from prior day closure to 23,655.17, while Hang Seng China Enterprises Index dropped 22.21 points to 12,077.87.
Among HK blue chips, Sino Land Co led declines in realty on further consolidation after a strong beginning to the year. Industrial & Commercial Bank of China led retreat in financials on news Goldman Sachs launched the sale of $1 billion worth of the lender's Hong Kong listed shares to further pare its holding in the Chinese bank. China Resources Power Holdings led gains in utilities as investors bought into defensive sectors.
In Singapore, Singapore shares ended slight lower as weakness in commodity stocks such as Noble Group overshadowed small gains in market heavyweight Singapore Telecommunications. The Straits Times Index was down 0.43% at 3,259.75 points. Noble fell 2.8% to S$1.22 on reports it was suspended from Argentina's grains register for an investigation into unpaid taxes, while SingTel gained 0.7% to S$3.84.
In India, the Indian market ended softer today, led by a drop in rate-sensitive stocks such as HDFC Bank, after the RBI lowered its key policy rate, but struck a cautious note on further easing as it waits to see how the government controls its fiscal deficit. The Sensex provisionally fell 0.57% at 19,900.90.
Reserve Bank of India (RBI) announced a 25 basis points reduction in its key policy rate viz. the repo rate and 25 basis points cut in cash reserve ratio after a monetary policy review.
From the banking pack, India's second largest private sector bank by net profit HDFC Bank shed 2.59% to Rs 652.65. Shares of banking giant State Bank of India (SBI) fell 1.41% to Rs 2,455 private sector bank ICICI Bank hit 52-week high. Axis Bank also struck a 52-week high after the private sector bank launched qualified institutional placement (QIP) of equity shares on Monday, 28 January 2013.
Dabur India fell 1.2% after announcing Q3 result. The company during market hours today, 29 January 2013, reported 22.15% growth rise in consolidated net profit to Rs 211.11 crore on 12.48% growth in total income to Rs 1658.01 crore in Q3 December 2012 over Q3 December 2011. Sterlite Industries (India) fell 0.79 after reported 30% growth in consolidated net profit to Rs 1191 crore on 4% growth in net sales to Rs 10692 crore in Q3 December 2012 over Q3 December 2011.
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