Headline shares of the Asia Pacific market advanced on Monday, 11 August 2014, as investors chased for bottom fishing on receding concerns of Russian aggression in Ukraine and clarity on US air strikes in Iraq.
The regional markets traded higher after a firm opening today, as geopolitical and economic risks appeared to ease. Russian media said Russia withdrew its troops from the Ukraine border as it sought to de-escalate tensions with Ukraine. Meanwhile, the US President Barack Obama said that he wouldn't send US ground troops back to Iraq and Israel began another cease-fire with Hamas.
Among Asian bourses
Nikkei shines 2.38%
Japanese share market rebounded, as bargain hunters stepped in following Friday's sharp selloff, helped by a stronger dollar. Meanwhile, good earnings results from key companies also helped give the broader market a boost. The benchmark Nikkei 225 index added 352.15 points to close at 15130.52, while the Topix index added 24.25 points to 1252.51.
The US dollar rebounded, ending at Y102.13 as of the close of the Tokyo Stock Exchange, up from Y101.74 at the same time on Friday. A stronger dollar is good for Japanese exporters, who can afford to price their goods more competitively overseas.
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The Nikkei newspaper reported $1.2 trillion Government Pension Investment Fund temporarily removed a cap on local stock investment. Removing deviation limits would enable GPIF to allocate more of its assets to domestic stocks before changing its target for the asset class in an upcoming review of holdings. The fund is expected to boost its goal for local shares to about 20% of its portfolio around September from the current level of 12%.
Mitsui Mining & Smelting Co. jumped 7.4% to 305 yen, after the company boosted its net income forecast 14% to 17.1 billion yen, beating analyst estimates for 16.3 billion yen in profit.
Daiwa House Industry Co gained 6.3% to 2,058 yen, after the homebuilder reported a 65% gain in profit. The Company's quarterly profit rose 65% to 30.7 billion yen. The company kept its forecasts unchanged.
Sumco Corp plunged 12% to 821 yen, after the silicon-wafer maker's net-income projection missed estimates. The manufacturer forecast 3.2 billion yen in net income for the three months through September. The stock was cut to underperform from outperform by CLSA.
Australia market rises for the first time in seven days
Australian stock market closed higher for the first time in seven consecutive sessions, as investors chased for bottom fishing on hopes recent selloff was overdone as compared to companies earning prospects. Meanwhile, easing geopolitical risks also sparked a buying in local equity market. The benchmark S&P/ASX 200 Index and the broader All Ordinaries Index each advanced by 0.4% to 5457 and 5449.40, respectively.
Bendigo and Adelaide Bank jumped 2.3% to A$12.46 as fiscal-year net interest margins improved. Total revenue rose by 6.3%, or A$84.7 million to A$1.4 billion. Statutory profit, which included one off non-cash costs for the year, was A$372.3 million, up 5.7%.The bank's net interest margin (the difference between what it earns from lending and the cost to fund that lending) was up 0.05% to 2.24% for the full financial year.
Treasury Wine Estates jumped 3.9% to A$5.33 after disclosing has received a second takeover offer from a global private equity firm, just weeks after Kohlberg Kravis Roberts and Rhone Capital launched a $3.4 billion bid. The firm, which requested its identity remain confidential for a period of time, has pitched its bid at A$5.20 and wants to do the deal via a scheme of arrangement. TPG was behind the latest bid, a person familiar with the matter said.
Online real estate advertiser REA Group was the Australian market's best performer, up 5.2% to A$45, on a series of brokerage house upgrades for the financial year ahead. Credit Suisse, which upgraded the stock from neutral to outperform, said the company provided a buying opportunity after a surprising 8.7% fall in the share price last week.
Australia's biggest goldminer, Newcrest Mining, lost 1.7% to A$10.99 as the price of gold fell 0.2% at US$1307 in late local trade after the flight to safe haven assets was reversed.
China stocks rise on monetary policy relax hopes
Mainland China stock market advanced to eight-month highs, on hope of further relax in domestic monetary policy, receding concerns of Russian aggression in Ukraine and clarity on US air strikes in Iraq. The benchmark Shanghai Composite rose 1.38%, or 30.23 points, to close at 2224.65. Turnover increased to 126.09 billion yuan from yesterday's 109.73 billion yuan. The gain in the shanghai market largely contributed by reinforced optimism for further relax monetary policy after tame inflation readings for July giving more room to the Beijing to maintain relatively ample liquidity in the financial system to prop up the economy.
China's consumer-price index climbed 2.3% in July from a year earlier, unchanged from June, while the producer-price index dropped 0.9% in July, slower than a 1.1% on-year decline in June, National Bureau of Statistics data released Saturday showed.
Most of the sectoral blue chips climbed up, with financial and realty stocks being biggest gainers on hopes that a broader easing of property curbs would buoy sales and arrest a downturn in the nation's real-estate market.
Haitong Securities gained 1.6% in Shanghai. Citic Securities Co., the biggest listed mainland brokerage, surged 2.3%. ICBC added 1.4% in Shanghai. Ping An Bank Co. advanced 1.6% in Shenzhen. Vanke, China's nation's biggest listed property company, added 1.8% in Shenzhen.
Hang Seng jumps 1.29% at close
Hong Kong share market advanced for first time in four consecutive sessions, as investors followed Friday's gains in the US on receding concerns of Russian aggression in Ukraine and clarity on US air strikes in Iraq. The benchmark Hang Seng Index advanced 314.61 points to close at 24646.02. Market turnover stood at HK$65.71 billion, down from yesterday's HK$71.91billion.
Shares of Chinese developers listed in Hong Kong rose on reports Shenzhen plans to make small adjustments to property policies and scrap limits on home prices. JP Morgan expects that China's property sector to see a slow August and then a big rebound of 30% M/M in September on the back of increased launches. It thus sees the recent correction as a good buying opportunity. Among developers, Sunac China jumped 9.3% to HK$6.72 and China Resources Land advanced 5.7% to HK$17.80. Other property counters also showed strength. Cheung Kong (00001) bounced 3% to HK$143.7. Henderson Land (00012) jumped 4.8% to HK$49.6.
Shares of banks and financials rose after UBS said in a research report that Chinese banks' net profit is estimated to grow 8% in 2014, slowing down from 12% in 2013. CCB (00939) rose 2% to HK$5.9. ICBC (01398) ascended 1.8% to HK$5.23. China Life (02628) gained 2.7% to HK$23.1. Ping An (02318) was up by 2.5% to HK$65.9.
Sensex snaps three-day losing streak
Indian stock market closed higher on heavy buying by funds and retail investors owing to positive global cues. The S&P BSE Sensex garnered 190.10 points or 0.75% to settle at 25,519.24 and the CNX Nifty garnered 57.40 points or 0.76% to settle at 7,625.95, its highest closing level since 7 August 2014.
Realty stocks were in demand after the market regulator the Securities and Exchange Board of India's board at a meeting held on Sunday, 10 August 2014, approved the SEBI (Real Estate Investment Trusts) Regulations, 2014 (REIT Regulations), thereby providing a framework for registration and regulation of Real Estate Investment Trusts (REITs).
Mahindra & Mahindra (M&M) jumped after the company's management at a post-result conference call on Friday, 8 August 2014, said that the company will introduce 5 new products and variants over next 15 months.
GAIL (India) slumped after reporting poor Q1 June 2014 result. Steel Authority of India rose after announcing good Q1 result.
Elsewhere in the Asia Pacific region-- South Korea's KOSPI index rose 0.41% to 2039.37. Taiwan's Taiex index added 0.96% to 9172.91. Singapore's Straits Times index climbed up 0.53% to 3306.45. Malaysia's KLCI rose 0.5% to 1849.32. Indonesia's Jakarta Composite index rose 1.18% to 5113.24. New Zealand's NZX50 fell 0.1% to 5049.63.
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