RTTNews - With a strong close on Wall Street on the back of some better than expected economic and earnings reports and optimism about global economy keeping the sentiment upbeat, stock markets across the Asia-Pacific region are trading firm on Friday. The mood is so positive in most of the markets in the region that a few indices have moved on to breach multi-month highs. Bank and energy stocks are among the prominent gainers in most of the markets.
The Australian benchmark index S&P/ASX 200 is up by 47.6 points or 1.1% at 4,238 and the broader All Ordinaries index is trading up 47.9 points or 1.1% at 4,243.8.
Bank stocks are trading firm. ANZ Bank, Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corporation are up by 1%-2.5%.
Material giants Rio Tinto and BHP Billiton are trading stronger by 3% and 1.7%, respectively. Fortescue Metals, Onesteel and Bluescope steel are also trading sharply higher. Energy major Woodside Petroleum is up by about 2%, while Santos is trading modestly higher.
Origin Energy Ltd says it achieved record production and sales in 2008/09, despite a fall in production in the fourth quarter. Annual production from Origin's Exploration and Production business increased by 4% to 104 petajoules equivalent, while sales revenue increased by 10% to A$572 million.
Compared with the June 2008 quarter, production and sales revenue were 15% and 6% lower, respectively due to the Australia Pacific LNG transaction, which diluted Origin's interest in CSG-producing assets by 50%. Sales revenue for the quarter fell by 6% from the prior-year corresponding period, from A$144 million to A$135 million. But sales increased by 13% from A$120 million in the March 2009 quarter. The Origin Energy stock is currently trading with a modest gain.
Shares of Elders Ltd soared this morning following an announcement from the company that it will sell its entire insurance business and place over 100 million of its shares to QBE Insurance Group Ltd for A$315 million.
The Elders stock is up by as much as 42% now, while QBI Insurance Group is trading up by around 1%.
Energy Resources of Australia Ltd, an exporter of uranium oxide to nuclear utilities in Asia, Europe and North America, posted a record first-half net profit, thanks to higher production and sales of uranium oxide. The firm's net profit for the six months to June 30 rose to A$127.6 million from A$38.9 million in the prior year's corresponding period. The company has also forecast higher revenues for the full year. The stock is trading nearly 2% up over its previous close.
In economic news, the TD Securities-Melbourne Institute inflation gauge rose 0.9% in July, the biggest monthly rise in the history of the report. According to the report, higher communications charges, as well as the cost of utilities and other housing, contributed most to the July result. The inflation gauge rose 1.9% in the 12 months to July, just below the Reserve Bank of Australia's 2%-3% target range for consumer price inflation.
In the currency market, the Australian dollar opened higher, bolstered by strong equity markets and higher commodity prices. In early trading this morning, the Aussie was quoting at US$0.8257/60, up from Thursday's close of US$0.8225/28 following rallies on world stock markets and soaring commodity prices. Currently, the Australian dollar is trading at 0.8271 to the U.S. dollar.
In Tokyo, the Japanese benchmark index Nikkei rose sharply on Friday and hit its highest intra-day levels since early October 2008 as stocks surged higher on better-than-expected earnings, a weaker yen and a bright close on Wall Street overnight. The Nikkei, which moved on to 10,313 this morning, was up by 139.69 points or 1.37% at 10,305 at the end of the morning session.
Construction, foods and chemicals stocks traded higher. Steel, non-ferrous metals and machinery stocks were also trading firm this morning. Pharma stocks were mixed.
Among automobile stocks, Toyota Motor, Suzuki Motor, Honda Motor, Nissan Motor and Isuzu Motors moved higher.
In the banking space, Sumitomo Mitsui Financial, Shizuoka Bank, Sumitomo Trust and Banking, Mitsubishi UFJ Financial, Fukuoka Financial and Chuo Mitsui Trust Holdings were among the prominent gainers.
Shares of Toyota Motor Corp. and Cannon Inc. moved up sharply on strong Wall Street cues and the yen's decline against the U.S. dollar.
Shares of Olympus Corp. advanced by over 3% on reports that the SLR camera maker likely saw a group net profit of around 2 billion yen in the April-June quarter. Although the figure makes for a 69% year-on-year drop, it would be an improvement from the 87.1 billion yen loss for the January-March period.
Sony Corp. and Sharp Corp. moved up sharply following the companies reporting smaller losses for the April-June quarter compared with the previous period. Sony's operating loss of 25.7 billion yen in the latest quarter was about 260 billion yen smaller than the January-March loss. Sharp's loss was reduced by about 64 billion yen, which was attributed to cuts in fixed costs as well as recovered sales of flat-panel televisions.
Despite a sharp 41% rise in group net profit, shares of Softbank Corp. declined after a positive start this morning with investors going in for some profit taking after recent gains.
In economic news, Japan's core consumer price index sank a record 1.7% year-on-year to 100.3 in June, declining for the fourth straight month, the Ministry of Internal Affairs said Friday. The core CPI for the Tokyo metropolitan area, considered a bellwether for nationwide price trends, also fell at its fastest pace in July, down 1.7% to 99.7.
According to a release from the Ministry of Internal Affairs, Japan's unemployment rate rose 0.2 percentage points from the previous month to 5.4% in June, marking the fifth straight month of increase. The number of jobless rose for the eight consecutive month to 3.48 million, an increase of 830,000. The number of people who were forced to quit their jobs due to employers' circumstances increased by 62,000, while 40,000 fewer left their jobs on their own.
Meanwhile, the ratio of job offers to seekers fell 0.01 point from May to 0.43, the lowest level ever, according to the Labor Ministry.
In the currency market, the U.S. dollar traded at the mid-95 yen level early Friday in Tokyo, little changed from its levels overnight in New York. The yen is currently trading at 95.28 to the U.S. dollar.
The Korean market is trading firm on Friday with a strong close on Wall Street overnight and hopes of a global revival on the back of some better-than-expected earnings and economic reports keeping the mood bullish once again.
The benchmark index KOSPI, which opened modestly higher at 1,543 this morning, is currently up by 16.3 points or 1.06% at 1,551
Among technology majors, Samsung Electronics and LG Electronics are trading higher. LG Display LCD is trading flat, while Hynix Semiconductor is down with a sharp 3% loss.
In the banking space, Korea Exchange Bank is gaining about 4.5% and Shinhan Financial is trading with a 2.7% gain. Woori Finance is modestly higher, while KB Financial is down by 3%.
Among automobile stocks, Kia Motor and Hyundai Motor are exhibiting weakness, while Ssangyong Motor is up nearly 15%. Oil stocks SK Holdings and S-Oil are trading flat. Among steel stocks, Hyundai Steel and POSCO are trading higher by 3% and 2.4% respectively.
Airliners Korea Airlines and Asiana Airlines are up by 5.7% and 3.5%, respectively. Telecom stocks SK Telecom and KT Corp are trading modestly higher.
Other markets in the Asia-Pacific region are also trading notably higher today. The key indices of Hong Kong, Taiwan, Shanghai and New Zealand are up by 0.9% - 1.7%. The Indonesian benchmark Jakarta Composite Average is up by about 0.75% and the Singaporean Straits Times is up by a modest 0.35%.
On Wall Street, fueled by stabilizing earnings and employment figures, stocks posted strong gains on Thursday. Despite some profit taking in the final hour, the major averages closed at their best levels of the year. The Dow finished up by 83.74 points or 0.9% at 9,155, the Nasdaq advanced by 16.54 points or 0.8% to 1,984 and the S&P 500 rose by 11.60 points or 1.2% to 987.
Major European markets closed notably higher, with the French CAC 40 index and the German DAX index finishing up by 1.7% and 2.1% respectively, while the U.K.'s FTSE 100 index rose by 1.9%.
Crude oil surged higher on Thursday as traders bet a recent plunge was overdone. The one-day gain was the largest since April. Light sweet crude for September delivery rallied to US$66.94 per barrel, up US$3.59 on the session. Prices touched as high as US$67.29, approaching the week's high crossing of US$68.99.
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