Asian stocks climbed for a sixth week, the longest streak of gains in more than two years, on increasing confidence the worst of the global recession is over.
China Cosco Holdings Co, the world’s largest operator of dry-bulk ships, surged 21 percent on rising Chinese exports and shipping rates. PT Bumi Resources, Asia’s largest exporter of power-station coal, jumped 21 percent in Jakarta as elections strengthened the hold Indonesia’s president has over parliament. JFE Holdings Inc, Japan’s No. 2 steelmaker, soared 22 percent on speculation it won’t make large price cuts and as the government unveiled a record stimulus package.
“We’re probably seeing a bottoming out in the economy,” said Arjuna Mahendran, Singapore-based chief investment strategist for Asia at HSBC Private Bank, which oversees US$494 billion in assets. “The second quarter will be good for stocks as corporate earnings should bounce.”
The MSCI Asia-Pacific Index rose 2 percent this week to 89.69, completing the longest stretch of gains since December 2006. Asian markets have rallied 27 percent since the MSCI benchmark dropped to a six-year low on March 9.
Japan’s Nikkei 225 Stock Average lost 0.6 percent. South Korea’s KOSPI index dropped 0.5 percent as brokerages cut recommendations on financial companies. Thailand’s SET Index gained 0.6 percent in a week shortened by new year holidays. The Thai government called a state of emergency following clashes between security forces and protesters in Bangkok.
MSCI’s Asian index plunged by a record 43 percent last year as the credit crunch tipped the world’s largest economies into recession, forcing companies to cut jobs amid slumping profits.
The gauge has rallied 27 percent from a five-year low reached on March 9 amid signs government measures to ease the financial crisis are working. Earnings estimates for companies included in the MSCI benchmark started to rise this month after a year of falling predictions, data compiled by Bloomberg showed.
China’s exports rose 39 percent last month from a month earlier, the customs bureau said on April 10, when Hong Kong markets were shut for a holiday. The Baltic Dry Index, a measure of shipping costs for commodities, jumped 13.8 percent this week. The gauge had slumped as much as 94 percent from a peak in May last year.
China posted a 6.1 percent annualized growth rate for the first quarter, the slowest rate of expansion in nearly a decade. That may mark the bottom for the world’s third-largest economy as a 4 trillion yuan (US$585 billion) stimulus package cushions the effects of the global recession.
Taiwanese share prices are expected to fall further in the week ahead following steep losses on Friday, with the market having failed to push above the key 6,000 point mark this week, dealers said.
Friday’s decline prompted many investors to be wary of stiff technical resistance ahead of 6,000 points, with the market having gained more than 30 percent since the beginning of last month, they said. Analysts said market sentiment toward the bellwether electronic sector is likely to turn cautious as high-tech heavyweights start to release their first quarter results next week.
However, companies with close business ties to China may attract interest, as they are expected to outperform the broader market, they added.
In the week to Friday, the TAIEX fell 26.58 points, or 0.50 percent, to 5,755.38 after a 4.56 percent increase a week earlier. Average daily turnover stood at NT$168.57 billion (US$4.99 billion), compared with NT$144.05 billion a week ago.
Other markets on Friday:
JAKARTA: Up 0.6 percent. The Jakarta Composite index rose 9.7 points to 1,634.79. The index has risen 24.59 percent over the past month.
MANILA: Up 1.42 percent. The composite index rose 29.47 points to 2,094.13. “Expectations of bad financial figures aren’t coming through,” Eagle Equities president Joseph Roxas said.
WELLINGTON: Up 1.81 percent. The NZX-50 gained 48.13 points to 2,711.29. The focus was on leading stocks and signs of fresh money entering the market, dealers said.
MUMBAI: Up 0.69 percent. The 30-share SENSEX rose 75.69 points to 11,023.09. Stocks shed most intraday gains as investors chose to unwind positions ahead of the weekend, dealers said.
PLA MANEUVERS: Although Beijing has yet to formally announce military drills, its coast guard vessels have been spotted near and around Taiwan since Friday The Taiwanese military is on high alert and is closely monitoring the Chinese People’s Liberation Army’s (PLA) air and naval deployments after Beijing yesterday reserved seven airspace areas east of its Zhejiang and Fujian provinces through Wednesday. Beijing’s action was perceived as a precursor to a potential third “Joint Sword” military exercise, which national security experts said the PLA could launch following President William Lai’s (賴清德) state visits to the nation’s three Pacific allies and stopovers in Hawaii and Guam last week. Unlike the Joint Sword military exercises in May and October, when Beijing provided detailed information about the affected areas, it
Five flights have been arranged to help nearly 2,000 Taiwanese tourists return home from Okinawa after being stranded due to cruise ship maintenance issues, the Ministry of Transportation and Communications announced yesterday. China Airlines Ltd (中華航空), and EVA Airways Corp (長榮航空) have arranged five flights with a total of 748 additional seats to transport 1,857 passengers from the MSC Bellissima back to Taiwan, the ministry said. The flights have been scheduled for yesterday and today by the Civil Aviation Administration, with the cruise operator covering all associated costs. The MSC Bellissima, carrying 4,341 passengers, departed from Keelung on Wednesday last week for Okinawa,
US president-elect Donald Trump said he would “never say” if Washington is committed to defending Taiwan from China, but “I would prefer that they do not do it [ an attack],” adding that he has a “good relationship” with Chinese President Xi Jinping (習近平). “I never say because I have to negotiate things, right?” Trump said in an interview with NBC’s Meet the Press host Kristen Welker after saying he would not reveal his incoming administration’s stance on Taiwan’s defense in the event of an attack. Asked the question again, Trump, in a reference to China, said: “I would prefer that they
CROSS-STRAIT TENSIONS: MOFA demanded Beijing stop its military intimidation and ‘irrational behavior’ that endanger peace and stability in the Indo-Pacific region The Presidential Office yesterday called on China to stop all “provocative acts,” saying ongoing Chinese military activity in the nearby waters of Taiwan was a “blatant disruption” of the “status quo” of security and stability in the Indo-Pacific region. Defense officials said they have detected Chinese ships since Monday, both off Taiwan and farther out along the first island chain. They described the formations as two walls designed to demonstrate that the waters belong to China. The Ministry of National Defense yesterday said it had detected 53 military aircraft operating around the nation over the past 24 hours, as well
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