Asia Pacific share market advanced on Tuesday, 1 December 2015, as risk sentiment lifted after improved Japanese data and IMF inclusion of the yuan in its basket of major currencies.
The International Monetary Fund admitted China's yuan into its elite reserve currency basket on Monday, recognizing the ascendance of the country in the global economy. The yuan will join the US dollar, euro, Japanese yen and British pound next year in the basket of currencies the IMF uses as an international reserve asset. The yuan's entry into the basket takes effect on October 1, 2016.
Results of a quarterly survey of major companies on capital spending and corporate profits released Tuesday by the Ministry of Finance. Combined capital investment by non-financial Japanese companies rose 11.2% on year in the July-September quarter, marking the 10th straight year-on-year rise with the pace of increase accelerating from +5.6% in April-June and +7.3% in January-March. Also, the ministry of economy, trade and industry data showed that Japan's factory output rose 1.4% in October from the previous month, marking the second straight monthly rise. Looking ahead, the ministry expected production in November to rise 0.2%, but fall 0.9% in December.
Building expectations for more stimulus to come in China amid another batch of soft economic data also underpinned buying in the regional stocks. The China's official Purchasing Managers' Index (PMI) stood at 49.6 in November, compared with the previous month's reading of 49.8 and below the 50-point mark that separates growth from contraction on a monthly basis. Separately, the Caixin China manufacturing purchasing managers index, a private gauge, rose to 48.6 in November from 48.3 in October.
Other private readings of manufacturing activity in the region showed contraction, too. South Korea's Nikkei PMI stayed unchanged at 49.1 in November from a month earlier. Taiwan's rose to 49.5 in November from 47.8 in October.
Meanwhile, the outcome of a monthly survey showed tepid growth in India's manufacturing sector last month. The seasonally adjusted Nikkei India Manufacturing Purchasing Managers' Index (PMI) fell to a 25-month low of 50.3 in November 2015.
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However, Australia's manufacturing sector expanded for the fifth straight month, with the Australian Industry Group's Performance of Manufacturing Index improving by 2.3 points to 52.5 in November.
Among Asian bourses
Nikkei ends above the psychological 20000 marks
The Japanese share market ended sharp higher, as better-than-expected factory output and capital expenditure data brightened the market mood on hopes the nation's economic soft spot may not be as deep as first thought. 32 out of 33 TSE industry group advanced, with the day's notable gainers comprised Electric Power & Gas, Iron & Steel, Machinery, Securities & Commodities Futures, and Electric Appliances issues. The Nikkei 225 index at the Tokyo Stock Exchange surged 1.34%, or 264.93 points, to 20012.40, breaching the 20,000 line for the first time since late August, while the wider Topix index of all first-section shares advanced 1.37%, or 21.70 points, to 1601.95.
Rising stocks outnumbered declining ones on the Tokyo Stock Exchange by 1343 to 530 and 1 ended unchanged. The Nikkei Volatility, which measures the implied volatility of Nikkei 225 options, was down 6.2% to 20.31, suggesting 5.8% swing in the equity benchmark index in the next 30 days.
Kajima Corp. added 3.9% after JPMorgan Chase & Co. raised its rating on the building contractor's stock to overweight.
Nissan Motor Co. slumped 1.9% after a Nikkei newspaper report it plans to increase its stake in French carmaker Renault SA to 25% or more.
Australia market soars as bargain hunters move in
The Australian share market finished the session sharply higher due to bargain buying among all ten sectors, led by consumer staples, materials & resources and financial blue-chip stocks. The advance came as further data suggested the local economy continues to hold up, despite the end to the boom in commodities investment and a more recent cooling in the property market. At the close, the benchmark S&P/ASX 200 index ended 99.60 points, or 1.93%, higher at 5266.10 points, while the broader All Ordinaries index grew 94.40 points, or 1.81%, to 5312.60 points. Rising stocks outnumbered declining ones on the Australia Stock Exchange by 562 to 448 and 151 ended unchanged. The S&P/ASX 200 VIX, which measures the implied volatility of S&P/ASX 200 options, was down 2.82% to 16.825 a new 3-months low, suggesting 4.8% swing in the equity benchmark index in the next 30 days.
Shares of metal & mining companies surged as investors took heart from economic data out of China and prices for gold, oil and copper lifted in Asia. Global miner BHP Billiton jumped 3.7% to A$18.75 and Rio Tinto gained 2.2%to A$46.92, while Fortescue Mining added 1.5% to A$1.99. Gold miner Newcrest Mining grew 3.7% to A$11.31. Oil and gas producer Woodside Petroleum was up 2.3% at A$30.81, and Santos firmed 1.3% to A$4.06.
Shares of consumer staples sector were also higher, with Woolworths up 3.5% to A$24.49 while Wesfarmers was up 2.3% to A$38.97. Wholesaler Metcash jumped 13.5%% to A$1.68, extending yesterday's gain after a well-received trading update at the start of the week. Dick Smith was up 24% to A$0.347, recouping some of Monday's sharp fall following a profit warning.
Shares of banks and financials were also higher, despite the decision by the Reserve Bank of Australia to hold interest rates at a record low of 2% for a seventh straight month. Australia & New Zealand Banking Group rose 2.4% to A$27.79 and Commonwealth Bank of Australia added 2% to A$80.99. National Australia Bank was up 1.8% at A$29.91.Westpac Banking Corp rose 2% to A$32.79.
GPT Group had lifted 2.6% to A$4.74 after the property firm announced leadership changes and a company restructure after the market close yesterday.
China stocks end higher after volatile ride
The Mainland China stock market modest higher after a volatile ride. The gain came on speculation that the People's Bank of China would undertake more economic stimulus measures after two monthly indicators of activity in China's manufacturing sector showed a contraction in November.The Shanghai Composite Index ended 0.32%, or 10.90 points, up at 3456.31 points. The Shenzhen Composite Index, which tracks stocks on China's second exchange, declined 0.24%, or 5.32 points, to close at 2198.28. The ChiNext Index, which tracks China's NASDAQ-style board of growth enterprises, was down 0.64%, or 17.24 points, to close at 2655.34.
Chinese brokerages ended the session mixed as the China Securities Regulatory Commission's (CSRC) investigation of short selling and speculation by brokerage firms continued. Banking stocks were also down, with major banks recording losses of between 0.6% and 2.19%.
Beijing Tongrentang Co. surged 6.1% to lead gains for drugmakers as air pollution enshrouding Beijing forced some parents to keep their children home from school.
Hong Kong market rises for first time in seven days
The Hong Kong stock market ended higher or the first time in seven straight days today, as investor sentiment boosted up on reinforcing talk that the Chinese government will loosen monetary policy to boost the economy after data showed China's manufacturing slipped to the weakest level in more than three years. Meanwhile, buying momentum spirited and as IMF inclusion of the yuan in its basket of major currencies raised confidence in China's progress toward financial liberalization. All major sectors in Hong Kong rose, with real estate and telecommunications shares leading the gains. Financial shares also advanced, as investors bet the yuan's inclusion in the SDR basket would deepen the currency's internationalisation, benefiting banks. The benchmark Hang Seng Index spurted 384.93 points, or 1.75%, to 22381.35 points. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, advanced 157.30 points, or 1.61%, to 9947.94 points. Turnover declined to HK$80.53 billion from HK$100.7 billion on Monday.
Property companies led the charge in the Hong Kong market, as investors speculated Beijing will introduce further stimulus measures including tax preferences, to support the industry. China Vanke shot up by 7.14% to HK$20.70.
Insurance and oil stocks were also ended stronger. AIA grew 3.13% and finished at HK$47.75. Huaneng Power rose 3.99% to finish at HK$7.03.
Nifty attains highest closing level in almost 4 weeks
Gains in metal, pharma and oil sector stocks enabled small gains for key benchmark indices after the Reserve Bank of India (RBI) kept its benchmark interest rate unchanged after a monetary policy review. The barometer index, the S&P BSE Sensex, rose 23.74 points or 0.09% to settle at 26,169.41. The Nifty rose 19.65 points or 0.25% to settle at 7,954.90.
The RBI kept its benchmark interest rate viz. the repo rate unchanged at 6.75% after a monetary policy review today, 1 December 2015. The central bank also kept the cash reserve ratio (CRR) for commercial banks unchanged at 4% of net demand and time liability (NDTL).
Mahindra & Mahindra (M&M) rose 0.18%. The company said during market hours that its total auto sales rose 21% to 41,590 units in November 2015 over November 2014.
Allahabad Bank gained 0.65% after the bank indicated that it may divest its stake in insurance joint venture Universal Sompo General Insurance.
Aurobindo Pharma gained 1.8% after the company announced that it has received final approval from the US Food & Drug Administration (USFDA) to manufacture and market Risedronate Sodium tablets USP, 5 milligram (mg), 30 mg and 35 mg.
Steel Strips Wheels (SSWL) rose 2.86% after the company announced securing an export order from Jaguar Land Rover.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index grew 1.7% to 8463.30. South Korea's KOPSI added 1.6% to 2023.93. Malaysia's KLCI jumped 0.6% to 1682.37. Singapore's Straits Times index gained 0.5% at 2870.26. Indonesia's Jakarta Composite index surged 2.5% to 4557.67. New Zealand's NZX50 rose 0.8% to 6150.68.
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