Regional markets suffered a precipitous correction since the chief of the Federal Reserve, Ben Bernanke, said the central bank might pull back on its $85 billion-a-month bond-buying program known as quantitative easing if U.S. economic data, especially hiring, improves. Investors are worrying over an implication of the US Federal Reserve's tapering of huge monetary easing, which helped propping up global equity markets.
US stocks rallied on Thursday due to upbeat economic data and on bets the Federal Reserve will signal plans to keep record-low interest rates. The data showed retail sales climbed the most in three months and the number of claims for jobless benefits dropped by 12,000 last week. The Federal Open Market Committee meets next week.
In the Asia Pacific market, Japan's benchmark Nikkei Stock Average rose soared 241.14 points, or 1.94% to 12,686.52, recovering from yesterday's plunge into bear market territory (down more than 20% from May peaks).
Kawasaki Heavy, Japan's second-biggest maker of heavy equipment, advanced 4.3% to 319 yen after firing President Satoshi Hasegawa and ending merger talks with Mitsui Engineering, two months after denying such discussions. Mitsui Engineering dropped 5.5% to 137 yen, the biggest loss on the Nikkei 225.
South Korea's Kospi index rose 0.4% on National Pension Service plans to allocate more funds to overseas equities as the country's biggest investor seeks to boost returns.
Australia's S&P/ASX 200 climbed 2% after entering a correction yesterday. Stock market operator ASX slumped 6.1% to A$33.15 in Sydney after the operator of Australia's main stock exchange completed the first part of an A$553 million capital raising to ensure its clearing business complies with new regulations.
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New Zealand's NZX 50 Index added 0.4% in Wellington, as rally on Wall Street and a gain in the kiwi dollar encouraged offshore investors.
Shanghai-listed shares rose for the first time in nine sessions on Friday, June 14, 2013, as value buying across the board following recent selloff trims the market valuation to the lowest since Dec. 12. The Shanghai Composite Index bounced 0.64% to 2,162.04 while the smaller Shenzhen Composite Index gained 2.13% to 975.65. Mainland's shares declined to six-month low on Thursday in reaction to a spate of weaker-than-expected data released over the weekend and the prospect of the resumption of initial public offerings [IPOs] leading to a share glut.
China released a number of statistics over the weekend suggesting a slowdown in both external and domestic demand, including a meager 1% rise for exports and 0.3% decline in imports from a year earlier. Meanwhile, the consumer price index rose 2.1% after climbing 2.4% in April, but the producer price index, which measures factory-level prices, fell 2.9%. China's industrial production was up 9.2% year on year in May, down fractionally from April's growth rate, and much slower than the rates of expansion routinely recorded in 2010 and 2011.
The China's economic growth slowed to 7.7% in the first quarter after a 7.9% rise in the fourth quarter of last year. The World Bank cut its forecast from 8.3% to 7.7%, the second cut since December. Morgan Stanley also lowered its projection from 8.2% to 7.6%, citing a less pro-growth policy stance of the Chinese government. UBS, Barclays, RBS, ANZ and other lenders put their forecasts below 8%.
Hong Kong's shares finished moderate higher in tandem with rise in Wall Street overnight, Mainland China and other regional bourses. The Hang Seng Index closed today at 20969.14, up 82.10 points or 0.39%. Chinese developers advanced on Xinhua News Agency report that Beijing home sales soared 40% in the five months through May, citing government data.
India's S&P BSE Sensex closed 1.9% higher on the back of positive cues from global peers and as investors took comfort in easing inflation. Shares of realty, consumer durable, auto, refinery and capital goods sectors advanced.
Elsewhere in the region, Indonesia's JKSE rose 3.3%. Singapore's Straits Times Index gained 1%. Malaysia's KLSE added 1.1%. Taiwan's Taiex Index fell 0.2%.
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