RTTNews - The markets across the Asia-Pacific region ended in positive territory amid cautious trading despite increasing optimism about the global recovery. Most of the markets, which opened higher on Wall Street cues, pared early gains on profit taking and managed to end in the green. Key economic data from the U.S and economic fundamentals, which are still not fully convincing enough, are withholding the appetite for risk on the part of investors, devoid of clear signals.
In the U.S., a report from the National Association of Realtors showed that pending home sales index rose 6.7% to 90.3 in April from a reading of 84.6 in March. Economists were expecting a modest 0.5% increase in the index for April. The increase came as homebuyers responded to very favorable market conditions.
The Dow finished up by 19.43 points or 0.2% at 8,741, the Nasdaq closed up 8.12 points or 0.4%, at 1,837 and the S&P 500 finished up by 1.87 points or 0.2% at 945.
The Nikkei 225 Average opened higher by 20 points at 9,724 compared to its previous close at 9,704, mirroring the gains on Wall Street. The index treaded in a narrow range between 9718 and 9774 amid alternate bouts of buying and selling before finally closing at 9,742, a gain of 37.36 points, or 0.38%. The broader Topix Index of all first section issues edged up 0.94 points, or 0.10% to close at 915.
There were no major domestic economic reports due out in today's session
Crude oil prices gained $0.18 and ended at $68.73 a barrel in Asian trading. Light crude oil price for July delivery closed at $68.55 in New York Mercantile Exchange on Tuesday on increasing optimism about global recovery.
Asahi Glass gained more than 5% and Nippon Electric Glass gained more than 8% after JP Morgan Chase raised the rating for glassmakers to overweight on expectations of higher sales following recovery in demand for flat-screen materials.
Chemical stocks advanced on expectations that possible mergers in the industry might result in higher profits. Mitsui Chemicals added 1.70%, Mitsubishi Chemical Holdings gained 0.90% and Tosoh Corp rose 0.96%.
Automakers also advanced, with Honda Motor gaining 1.95% and Toyota Motor adding 1.30%. However, Nissan Motor remained unchanged at previous close.
Financial stocks ended in negative territory following drop in their peers on Wall Street. Mitsuibishi UFJ lost 1.13%, Mizuho Financial slipped 1.26%, Resona Holdings shed 0.83% and Sumitomo Mitsui edged down 0.27%.
The All Ordinaries Index opened unchanged from its previous close at 3,948 and briefly slipped into negative territory before recovering and moving above the unchanged line. The positive GDP report lifted market sentiment and the index surged past the psychological 4,000-mark, led by property, resource and bank stocks. The index ended the trading session at the day's high at 4,009, up 61.20 points, or 1.55%. The benchmark S&P/ASX 200 Index followed a similar trend and ended up at 4,017 with a gain of 61.90 points, or 1.56%.
On the economic front, the Australian Bureau of Statistics revealed that the country averted a technical recession as gross domestic product unexpectedly rose a seasonally adjusted 0.4% in the first quarter of 2009 compared to the previous quarter. That was significantly higher than the 0.2% quarterly contraction that analysts had been expecting after the revised 0.6% decline in the previous three months.
A separate report from the Australian Industry Group and Commonwealth Bank revealed that services sector activity contracted for the 14th consecutive month in May, although the pace slowed from that recorded in the first quarter. While the Performance of Services Index rose 0.1 points from April to 39.9, sales index fell to 39.1 from 39.9, and the capacity utilization decreased to 72.2% from 75.8%.
Property, resource and bank stocks were the major gainers.
In the property space, Mirvac Group soared 9.02%, Lend Lease gained 6.25% and Westfield Group rose 6.10%. GPT Group was in the spotlight , gaining 12.50% after the company announced sale of assets equivalent to A$560 million to restructure its core business model.
Resource stocks also advanced on increasing hopes of recovery and a rise in demand. BHP Billiton gained 0.90%, Iluka Resources rose 3.37%, and Rio Tinto advanced 3.77%. Among gold stocks, Sino Gold edged up 0.46% and New crest Mining gained 1.50%. However Lihir Gold bucked the trend and shed 0.20%.
Banking stocks also ended higher on positive GDP data for first quarter. ANZ Bank gained 2.38%, Commonwealth Bank added 1.29%, National Australia Bank rose 1.36% and Westpac Banking advanced 2.19%.
In Hong Kong, the Hang Seng Index opened sharply higher at 18,617 compared to its previous close at 18,389, and continued to surge ahead led by property stocks. However, profit taking in late trading ahead of U.S economic data and lack of buying support at higher levels trimmed the gains after the index rose to day's high of 18,968. The market finally closed at 18,576, up 187.39 points, or 1.02%.
A report from Land Registry in Hong Kong revealed that city's home sales surged 42% in terms of volume, during May 2009, lifting the index sharply higher led by property developers. SHK Property added 3.12%, New World Development gained 3.63%, and Sino Land advanced 6.20%.
PetroChina added 1.88% and CNOOC, the largest offshore oil company in China, edged up 0.37%. Aluminum Corp. of China, or CHALCO, surged 5.32% on expectations of higher demand
China-related stocks ended mixed on profit taking. China Mercantile Holdings gained 3.07%, but China Resources slipped 0.11% and China Shenhua lost 0.74%.
In South Korea, the benchmark KOSPI Index ended in positive territory led by shipbuilding and technology stocks offset by losses in financial stocks. The index having opened higher at 1,424 compared to previous close at 1,415, gave back the gains on profit taking and traded in a narrow range around the unchanged line amid volatile trading. The benchmark KOSPI Index ended the session with a gain of 2.04 points or 0.14% at 1,415.
Shipping related stocks advanced after the Baltic Dry Index advanced. Hyundai Heavy Industries climbed 4.16% Daewoo Shipbuilding & Marine Engineering, the world's third-largest shipbuilder, advanced 2.92%
Technology related stocks also ended higher. Chip giant Hynix Semiconductor jumped 5.12% and flat panel leader LG Display advanced 1.57%
Financial stocks ended weak following US market cues. KB Financial, which controls Kookmin Bank, declined 1.51%, Shinhan Financial lost 1.57% and Woori Finance shed 5.70%.
In India, the stock market ended in negative territory amid volatile trading as investors preferred to take profits after the market gained nearly 80% from the year's low in the past few sessions.
The BSE Sensex ended at 14,871 with a loss of 4.01 points, or 0.03%, while the broader Nifty gained 5.45 points or 0.12% to close at 4531.
Among the other major markets in the region, China's Shanghai Composite Index added 54.29 points, or 1.99% to close at 2,779, Indonesia's Jakarta Composite Index ended at 2,010 with a gain of 12.27 points, or 0.61%, and Strait Times Index in Singapore gained 8.00 points or 0.34% to close down at 2,384. However, the Taiwan Weighted Index edged down 55.94 points, or 0.80% to close at 6,893.
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