Asian markets finish Friday on fabulous note

December 2009, as markets in the region were seen struggling a bit to hold at higher

levels with a section of investors looking to take profits ahead of the weekend, the mood

continues to remain fairly positive. Buoyed by a strong close on Wall Street overnight on

the back of better-than-expected jobs and export data, investors have been closing books

ahead of the year-end in a climate of concern about the creditworthiness of various

troubled economies.

On Wall Street, stocks closed higher, as news that the international trade gap narrowed in

October appeared to outweigh listless initial jobless claims data. The Dow Jones

 

Industrial Average closed higher by 69 points, or 0.7%, to 10,406. The S&P 500 rose 6

points, or 0.6%, at 1102 and the Nasdaq added 7 points, or 0.3%, to 2191.

In the commodity market, crude oil rose for the first time in eight days after China’s

government said the country’s refineries processed a record amount of crude last

month. China imported 17.1 million metric tons of crude oil in November, 28% more than a

year earlier. Imports of crude oil in the first 11 months gained 11% to 182.5 million

tons.

The International Energy Agency cut its forecast for oil supplies from outside the

Organization of Petroleum Exporting Countries next year because of delays to North

American projects. The IEA raised its forecast for 2010 global oil demand for a fifth

month, and boosted its medium-term consumption outlook through to 2014, on expectations of

economic recovery. Worldwide demand is likely to average 86.3 million barrels a day in

2010, 130,000 a day more than previously estimated.

Crude oil for January delivery rose as much as 55 cents, or 0.8%, to $71.09 a barrel in

electronic trading on the New York Mercantile Exchange. It was at $71.05 a barrel at 9:32

a.m. London time.

Brent crude oil for January settlement rose as much as 74 cents, or 1%, to $72.60 on the

London-based ICE Futures Europe exchange. It was at $72.44 a barrel at 9:33 a.m. local

time.

Gold gained for a third day in Asia, paring a second weekly decline, as the precious

metal’s 7.2% slump from its all-time high lured investors. Spot gold added as much as

0.7% to $1,138.90 an ounce before trading at $1,135.80 at 3:54 p.m. in Singapore.

December-delivery gold on the Comex division of the New York Mercantile Exchange gained as

much as 1.2% to $1,139.90 an ounce and last traded 0.9% higher at $1,136.40.

In the currency market, the US dollar rose against major Asian currencies as strong

Chinese economic data fueled optimism about the global economic recovery, to the detriment

of the safe-haven, low-yielding Japanese currency.

The Japanese yen softened against the major currencies today. The yen was quoted at 130.64

per euro today. Japan’s currency was quoted at 88.77 per dollar.

The Hong Kong dollar was trading at HK$ 7.7508 against the dollar. Actually the Hong Kong

dollar is pegged at HK$ 7.8 to the U.S. dollar but can trade between HK$ 7.75 and HK$7.85

to the U.S. dollar.

In Sydney trade, the Australian dollar closed higher in line with a stronger gold price

and equity market, but failed to make any large moves as investor’s awaited key US

data during the offshore session. At local closing, the Australian dollar was trading at

$US0.9164/71, up from Thursday's close of $US0.9120/24. During the domestic session, the

local unit traded between $US0.9142 and $US0.9173.

In Wellington trade, the New Zealand dollar pushed towards 73 US cents after the Reserve

Bank brought forward its expectations for tighter monetary policy, stoking demand for the

currency. The kiwi surged 2.3% against the greenback after the central bank Governor Alan

Bollard said he might start removing stimulus around the middle of next year, and the

regulator brought forward its timeline for increases in the 90-day bank bill to the June

quarter from the December quarter.

The South Korean won closed at 1,164 won to the U.S. dollar, up 1.5 won from Thursday's

close as net stock buying by foreign investors raised demand for the won.

The Taiwan dollar strengthened against the greenback. The Taiwan dollar was trading higher

against the US dollar at NT$ 32.2780, 0.0300 up from Thursday’s close of NT$32.3080.

In equities, Asian shares ended mostly higher Friday after data from China appeared to

show that the economic recovery there is gaining momentum while brighter U.S. jobs data

lifted stocks on Wall Street.

In Japan, shares market rose for the first time in four sessions, underpinned by strength

in offshore markets, positive Chinese economic data, and a halt in the yen's advance in

the currency market.

At the closing bell, the Nikkei 225 Stock Average index was at 10,107.87, rose 245.05

points or 2.48% from its previous close, while the broader Topix of all First Section

issues on the Tokyo Stock Exchange added 14.67 points, or 1.68%, to 888.57. The Nikkei 225

Stock Average index added 85.28 points or 0.85%, while the broader Topix index slid 1.01

points or 0.11%, for the week ended Friday, 11 December 2009.

In Mainland China, share market tumbled after fluctuating in and out of gains line at

least four times throughout the session. Market reaction was subdued despite official data

showed China industrial production in November was better than estimated.

The Shanghai Composite Index, measuring A shares and B shares on the Shanghai Stock

Exchange, slid 6.95 points, or 0.21%, to 3,247.32, meanwhile the Shenzhen Component Index

on the smaller Shenzhen Stock Exchange rose 0.05% or 7.07 points, to 13,875.87. The CSI

300 Index, measuring exchanges in Shanghai and Shenzhen, edged lower 0.1%, to 3,575.02.

The Shanghai Composite index lost 69.72 points, or 2.1%, while the CSI 300 Index slipped

68.47 points or 1.88%, for the week ended Friday, 11 December 2009.

On the economic front, the National Bureau of Statistics data showed that China industrial

output rose 19.2% in November from a year earlier. The increase rate was 13.8% higher from

a year earlier and 3.1% higher than October.

Meanwhile, the bureau also said China's retail sales in November rose 15.8% year-on-year.

The rise was 5 percentage points lower than that of a year earlier, and 0.4 percentage

points lower than that in October.

China's consumer price index, a main gauge of inflation, increased 0.6% year-on-year in

November, ending nine months of decline, according to the NBS. The producer price index

(PPI), a major measure of inflation at the wholesale level, dropped 2.1% year-on-year in

November.

The National Bureau of Statistics said yesterday that China’s urban housing prices

rose in November by the most in sixteen months, as buyer sentiments remain strong. Housing

prices in 70 major cities jumped 5.7% last month from a year ago. On a month-to-month

basis, property prices in November advanced 1.2% nationwide, the ninth consecutive gain.

In Hong Kong, the benchmark index registered gains snapping five days of loosing streak,

sparkled by firm global cues following signs of improvement in the U.S job market,

improved U.S. trade balance, and strong Chinese economic indicators. Gains were further

buoyed up after a slew of Chinese economic data showed the world's third-largest economy

is on a brisk recovery path.

At the closing bell, the Hang Seng Index surged 202.07 points, or 0.93%, to 21,902.11,

meanwhile the Hang Seng China Enterprise, which tracks the overall performance of 43

mainland Chinese state-owned enterprises on the Hong Kong Stock Exchange, increased 101.36

points, or 0.79%, to 12,967.49. The Hong Kong benchmark Hang Seng Index dropped 596.04

points or 2.65%, while Hang Seng China Enterprises dived 494.06 points or 3.67%, in the

week ended Friday, 11 December 2009.

In Australia, the stock market snapped five days of loosing streak, on broad based bargain

hunting following a strong lead from Wall Street overnight after improving trends in the

US job market and a decline in the October trade deficit in US. Gains were also buoyed as

stronger than expected industrial production figures from China reinforced the rosy

outlook for the domestic resources companies.

At the closing bell, the benchmark S&P/ASX200 index surged 28.5 points, or 0.62%, to

4,635.2, meanwhile the broader All Ordinaries added 28.50 points, or 0.62%, to 4,651.4.

The benchmark S&P/ASX200 index stumbled 67 points, or 1.42% in the week ended Friday,

11 December 2009, meanwhile the Broader All Ordinaries retracted 69.8 points or 1.5%,

during same period.

In New Zealand, benchmark index dipped again after inching up yesterday followed by four

consecutive declines during the week. The NZX50 dipped down 0.14% or 4.3 points to

3127.98. The NZX 15 decreased 0.37% or 20.98 points to close at 5684.46.

On the economic front, New Zealand food prices decreased 0.3% in the November 2009 month.

This is the fourth consecutive monthly fall in food prices, which has not occurred since

July 2004. November’s fall in the food price index (FPI) was largely driven by lower

prices for fruit and vegetables, as occurred in October and September 2009.

In South Korea, stocks closed higher, led by massive purchases among institutional

investors. Erasing opening losses, the benchmark Korea Composite Stock Price Index (KOSPI)

added 4.17 points to end at a fresh seven-week high of 1,656.9. Strong buying among

institutional investors helped the KOSPI add gains for nine of the past 10 trading

sessions to close at its highest level since 26 October 2009.

In Singapore, stocks market made a stellar recovery, recouped yesterday losses to finish

the session above the gain line, on the back of strong cues from Wall Street overnight and

bigger than expected China industrial production data. At the closing bell, the blue chip

Straits Times Index was at 2,800.75, rose 18.89 points or 0.68%, off an intraday low of

2,783.78.

In Taiwan, stock markets continued to swing between gains and losses, as all sector

finished the week in green following the strong lead from the Wall Street. The benchmark

Taiex share index resumed with gains, by finishing the day higher by 117.16 points or

1.56% at 7795.07, second highest closing since 26 June 2008 when market finished the day

at 7811.80.

On the economic front, Taiwan’s outstanding foreign exchange reserves continued to

hit a record high of US$347.19 billion in November, up US$5.968 billion of a month

earlier. According to statistics released by Taiwan’s central bank, the central bank

officials attributed the growth mainly to the net capital inflow of US$2 billion during

the month and the book incomes from the bank’s holdings of euro and Japanese yen,

which appreciated by 0.7% and 6.33%, respectively, in value against the greenback.

In Philippines, the stock market closed higher, in line with the Asian equities,

sidelining the gloomy consumer sentiment data. Positive cues from Wall Street overnight

and a strong recovery in electronics sector supported the markets. The benchmark index

PSEi escalated 0.81% or 24.56 points to 3,031.13, while the All Shares index mounted 0.65%

or 12.31 points to 1,883.00.

In India, the key benchmark indices ended a choppy trading session lower as industrial

production growth for October 2009 only matched estimates while market participants had

hoped for a big surprise. Banking and realty stocks also fell on rate hike worries.

Capital goods stocks rose.

The BSE Sensex was down 70.28 points or 0.41% to 17,119.03. The Sensex rose 162.40 points

at the day's high of 17351.71 in early afternoon trade. The Sensex fell 133.19 points at

the day's low of 17056.12 in afternoon trade. The S&P CNX Nifty was down 17.35 points

or 0.34% to 5,117.30.

On the economic front, industrial output jumped 10.3% in October 2009 from a year earlier,

helped by stimulus measures and robust domestic demand, data released by the government

showed. Manufacturing production rose 11.1% in October 2009 from a decline of 0.6% a year

earlier. September's annual industrial growth rate was revised upward to 9.6% from 9.1%

previously. Industrial output rose 2.6% in the 2008/09 fiscal year (April-March), slower

than 8.5% in 2007/08.

Elsewhere, Malaysia’s Kula Lumpur Composite index finished slightly higher at 1260

while stock markets in Indonesia’s Jakarta Composite index inched up 32.66 points

ending the day higher at 2519.10.

In other regional market, European shares rose on Friday, with miners lifted by hopes for

rising demand for metals after data indicated that China's economic recovery continues to

strengthen. Regional equity markets were also higher. The U.K. FTSE 100 index rose 1.1% or

56.41 points to 5,301, the German DAX index climbed 1.1% or 62.82 points to 5,772 and the

French CAC-40 index advanced 0.7% or 26.23 points to 3,825.

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