Asia Pacific share market finished last trading session of the week ended Friday, 19 December 2014, on a stronger footing after the Federal Reserve signalled it was in no rush to lift interest rates.
Investors risk appetite improved globally amid relief that the Federal Reserve appears in no rush to withdraw stimulus from the U.S. economy and as investors began to see the advantages of lower oil and fuel costs that should ultimately help global growth.
The US Federal Reserve pledged patience on interest-rate increases after the conclusion of its two-day monetary policy meeting on 17 December 2014, a potentially longer timeline than some investors had anticipated.
The Federal Reserve said it will be "patient" on the timing of interest-rate increases - a subtle hint that the US central bank will not rush into its first interest-rate increase in seven years, which market participants believe will happen mid-2015. A longer timeline for rate increases in the United States implies that equities will continue to be more appealing to investors.
Among Asian bourses
Australia market rises for third day
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Australian share market advanced for third consecutive session, joining the global rally, on tracking its cue from continued gains on Wall Street overnight after the Federal Reserve signalled it was in no rush to lift interest rates. The benchmark S&P/ASX 200 index advanced 127.80 points, or 2.45%, to close at 5338.60, while the broader All Ordinaries index added 123 points, or 2.37%, to 5312.70. Market turnover was relatively healthy, with 2.15 billion shares changed hands worth of A$6.39 billion. Total of 944 stocks were up, while 469 were down. For the week, the ASX200 rose 2.3%, while the All Ordinaries added 2.2%.
Shares of energy companies continued to recover from heavy selling in recent weeks, with Woodside Petroleum adding 3.2% to A$37.77, while Origin Energy rose 3% to A$11.51 and Oil Search added 0.8% to A$7.68. Santos rose 0.4% to A$7.99 after it said it had secured an additional 1 billion Australian dollars (US$817 million) debt facility.
The big banks and miners also continued their way higher. Among big banks, Westpac Banking Corp rose 2.9% to A$32.48, ANZ Banking Group 2.3% to A$31.68, National Australia Bank 2.9% to A$32.66 and Commonwealth Bank of Australia 2.3% to A$83.71. Among mining stocks, BHP Billiton surged 3.4% to A$28.98 and Rio Tinto added 2.9% to A$56.29. Fortescue Metals was 2% higher at A$2.55.
Nikkei rises 2.4%
Japanese share market advanced today, as appetite for riskier assets encouraged after yen depreciation against major currencies and the Federal Reserve's reassurance it was in no hurry to hike interest rates. The benchmark Nikkei Stock Average advanced 2.39% to end at 17621.40. For the week, the Nikkei index was up by 1.4%.
Shares of export-related companies extended gain, as the weakening yen will boost overseas earnings at Japanese exporters when repatriated, with auto makers among the biggest gainers. Toyota Motor Corp, which gets about 31% of its revenue from North America, gained 4.3% to 7562 yen. Honda Motor Co, which gets about 80% of its revenue abroad, rose 2.5% to 3580 yen. Mazda Motor Corp added 3.4% to 2991 yen and Nissan Motor Co jumped 2.4% to 1049 yen. Among tech exporters, industrial robot maker Fanuc Corp added 3.1% to 20395 yen, while chip testing equipment maker Advantest Corp rose 3% to 1531 yen. Canon Inc, the world's biggest camera maker, jumped 1% to 3918 yen.
Sapporo Holdings rose 3.5% to 539 yen after its beer-making subsidiary announced Thursday that its full calendar-year target to ship 5.5 million cases of its popular Goku Zero pale lager beer has already been achieved, putting it on pace for an overshoot with 11 days still left in 2014.
Shares of convenience store operator Seven & i Holdings rose 2% to 4394 yen after a Nikkei report saying the firm is expected to post a consolidated operating profit of more than Y250 billion in the March-November period, a second straight record high for the three-quarter period.
Heavy-equipment maker IHI added 5.8% to 621 yen after Citigroup initiated coverage at buy with a price target of Y740, citing weaker-yen benefits for profit margins across its product and product support lines, and resiliency in its aircraft engine business.
China stocks surges to 4-year high
Mainland China stock market advanced to four-year high, as risk sentiments remained bullish on growing expectations of more monetary easing. All sectors rose, with shares of metal and transport companies being major gainers. The benchmark Shanghai Composite was higher by 51.07 points, or 1.67%, to finish at 3108.60, its highest close since November 11, 2010 when it closed at 3147.74.
The risk appetite buying continued in Chinese shares amid speculation the central bank will reduce lenders' reserve-requirement ratios after cutting interest rates for the first time in two years last month. Shanghai Composite has advanced 47% this year.
Total of 5 out of 10 SSE industry groups advanced, with gauges of industrial companies rose the most, up 5.1%, followed by utilities (up 4.9%), energy (up 3.6%), and material (up 2.3%). Bucking the trend, technology gauge dropped the most, down 1.5%, followed by healthcare, down 1.1%.
Shares of material companies advanced, with Jiangxi Copper Co., China's biggest producer of the metal, gaining 4.1% to 18.48 yuan and gold producer Zijin Mining Group Co. added 3.4% to 3.33 yuan. Aluminum Corp of China jumped 10% daily limit to 5.80 yuan after aluminum producer said it will sell stakes in four solar product units in Ningxia province through a public tender.
Shares of industrials and utilities companies also blasted their way higher. China State Construction Engineering rose 10.1% to 6.88 yuan, GD Power Development added 9.9% to 4.10 yuan and China Shipbuilding Industry rose 5.9% to 9.84 yuan. Zoomlion Heavy Industry Science & Technology was up 10% to 6.84 yuan.
HK Stocks surges on strong offshore lead
Hong Kong share market advanced for second consecutive session, joining the global rally, on tracking its cue from continued gains on Wall Street overnight after the Federal Reserve signalled it was in no rush to lift interest rates.
The Hang Seng Index ended higher 284.42 points, or 1.25%, to 22116.63, off an intra-day high of 2389.60 and low of 23041.37. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, climbed up 69.46 points, or 0.61%, to 11400.19. Turnover decreased to HK$95.70 billion from HK$99.64 billion on Thursday.
Within HK 50 blue chips, 38 stocks rose and 10 fell, with 2 stocks remaining steady. AIA rose 3.41% to HK$42.50 after Credit Suisse's bullish comments, while LI & FUNG dipped 2.5% to HK$7.30, making themselves the biggest blue chip winner and loser. Tencent (00700) also gained 3.4% to HK$115.7.
BYD Co closed 14.2% higher at HK$28.6, rebounding after severe sell-off yesterday, thanks to the Company clarification that its business operations are in normal conditions, and the development of various businesses has been smooth.
In respect of the rumor "The Company has suffered substantial exchange losses in the amount of several hundred million United States Dollars in Russia", the value of products of BYD Company exported to Russia is not substantial (less than US$1 million), and such products are traded in United States Dollars, and hence there have not been substantial exchange losses incurred. In respect of the rumor "Number of customer orders for electric bus received by the Company has significantly decreased", BYD Company said the development of its electric vehicle business is in normal conditions, and the number of customer orders for electric bus received has not substantially decreased. In respect of the rumor "Warren Buffett has intended to sell a substantial amount of his shares in the Company", BYD Company has communicated and confirmed with the relevant person-in-charge of Berkshire Hathaway Inc., the company owned by Warren Buffett holding the shares of BYD Company, that the intention to reduce shareholdings in BYD Company is not correct and that it has no present intention to reduce shareholdings in BYD Company.
Sensex rallies on economic growth prospects
Indian stock market extended gains for the second straight session as the government's projection of 5.5% GDP growth boosted economic sentiments. Expectations of acceleration in reforms process after the Cabinet's clearance to the Constitutional Amendment Bill on GST too triggered buying activity. The Nifty rose 0.81% to 8225.20, while the benchmark BSE Sensex ended up 0.9% at 27371.84.
The Finance Ministry's Mid-Year Economic Review has said that India's GDP is expected to rise to 5.5% in the current fiscal from 4.7% last year on back of improving macro-economic situation.
IT stocks gained after US based global management consulting, technology services and outsourcing company Accenture yesterday, 18 December 2014, raised its outlook for net revenue growth for the year ending 31 August 2015 (FY 2015) after reporting strong Q1 results. Infosys gained 1.7%, Tata Consultancy Services rose 2% and Wipro advanced 2.3%. HCL Technologies gained 2.3% while Tech Mahindra added 1.2%.
Reliance Industries gained 2.32% on bets the company's telecom unit Reliance Jio will rollout 4G services in the next few months.
Select coal users gained after the government on Thursday released an approach paper on rules for auctioning of coal mines. Sesa Sterlite gained 2.2%, Hindalco Industries rose 3.2% while CESC advanced 1%.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index rose 1.36% to 8999.52. South Korea KOSPI was up 1.71% to 1929.98. New Zealand's NZX50 rose 0.2% at 5528. Singapore's Straits Times index rose 1.1% at 3279.53. Indonesia's Jakarta Composite index added 0.61% to 5144.62. Malaysia's KLCI added 0.94% to 1716.
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