Asia Pacific stock market mostly advanced on Friday, 19 June 2015, mirroring sharp gains from Wall Street overnight after the Federal Reserve signaled it would move more slowly on raising interest rates.
Investors continued to cheer what they perceived as a dovish tone set by the US central bank and Chairwoman Janet Yellen following the conclusion of a two-day Fed policy meeting on Wednesday, 17 June 2015.
Meantime, investors continue to monitor development in Greece after the Eurogroup of eurozone finance ministers concluded a closely watched meeting yesterday, 18 June 2015, without a deal to unlock financial aid to the debt-laden country. After the talks collapsed, the EU called an emergency summit of leaders for Monday, 22 June 2015, to urgently discuss the situation of Greece. Greece is still struggling to reach a reform agreement with its lenders, which would unlock the next portion of bailout money needed to repay 1.6 billion euros ($1.82 billion) to IMF by the end of June.
Among Asian bourses
Australia market rebounds 1.3%
The Australian share market advanced today, as risk appetite buying across the board spurred by tracking robust session on Wall Street overnight, with financials, miners and energy stocks being top gainers. The benchmark S&P/ASX 200 Index rebounded 72.10 points, or 1.31%, to 5597, chalking up a weekly gain of 0.9%, while the broader All Ordinaries Index gained 68.80 points, or 1.25%, to 5591.50. Market turnover was above average with 1.44 billion shares changing hands worth of A$3.4 billion.
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Shares of banks and financial advanced, after Warren Buffett signalled he may invest in the sector. Westpac Banking Corp rose 1% to A$32.80, Australia & New Zealand Banking Group 1.2% to A$32.76, National Australia Bank 1.6% to A$33.66, and Commonwealth Bank of Australia 1.5% to A$84.47.
Materials and resources stocks also gained, thanks to rises in commodity prices. Rio Tinto added 1.1% to A$55.55 and BHP Billiton rose 1.6% to A$28.41. Junior iron ore producer Fortescue Metals Group grew 1.4% to A$2.16. Arrium was up 11.1% to A$0.15.
Energy stocks were also higher, inline with rebound in crude oil futures. Benchmark U.S. crude rose 4 cents to $60.49 a barrel in electronic trading on the New York Mercantile Exchange. It rose 53 cents to close at $60.45 a barrel in New York on Thursday. Brent crude, a benchmark for international oil used by many U.S. refineries, gained 2 cents to $64.28. Oil Search advanced 2% to A$7.51 and Woodside Petroleum rose 0.8% to A$35.64.
Bradken dropped 3.5% to A$1.925 as its CEO announced his retirement after 18 years with the mining equipment and machinery maker.
Nikkei rebounds 0.92% after BOJ decision
Japanese share market finished higher for the first time in five consecutive sessions, as investors chased for bottom hunting on tracking solid gains on the Wall Street overnight. The upward momentum also supported by Bank of Japan's (BoJ) decision to maintain status quo and to continue to expand its monetary base at an annual pace of 80 trillion yen. Market sentiment was further supported by data showing strong foreigners' appetite in the Japanese market. The Nikkei Stock Average escalated 183.42 points, or 0.92%, to end at 20174.24. The Topix index of all Tokyo Stock Exchange First Section issues jumped 0.89%, or 14.35 points, to close at 1631.01. The gauge fell 1.2% this week.
The Bank of Japan kept monetary policy steady and maintained its upbeat assessment of the economy on Friday, signalling its conviction that inflation will hit its 2% target without additional monetary stimulus. The Japanese central bank also said it would move to improve its communication by issuing more frequent and detailed reports on its economic outlook, while cutting the number of policy meetings to eight from the current 14 a year.
Shares of shipping line were top gainers in the Tokyo on tracking gain on the shipping freight rate. The Baltic Dry Index jumped 6.6% on Thursday, an eighth day of gains and hitting its highest level this year. Nippon Yusen KK gained 3.3% to 345 yen, while rival shipper Mitsui OSK Lines rose 1.3% to 387 yen.
Seven & i Holdings soared 2.8% to 5153 yen on reports that the supermarket operator likely logged an operating profit of around 81.5 billion yen ($655 million) for the March-May quarter.
Japan Petroleum Exploration Co. rose 1.7% after SMBC Nikko Securities Inc. boosted its rating on the stock to outperform from neutral.
Tokyo Gas Co. slumped 2.3% to 671 yen after Morgan Stanley Mitsubishi UFJ Securities Co. cut its rating on the shares to equalweight from overweight.
China market plummets 6.4% as bubble fears grow
Mainland China share market tanked for second straight day amid mounting concerns over the potential impact of a flurry of initial public offerings and moves by regulators to curb margin trading. Meanwhile, risk off selloff intensified amid fears of a bubble in China's volatile equity markets after rising 140% over 12 months and around 50% year to date. All 10 sectors dived into red, with losses were paced by material and industrial companies. The benchmark Shanghai Composite Index plummeted 307 points, or 6.42%, to 4478.36, taking its declines for the week to 13%.
This week's correction was triggered by regulators' fresh moves to tighten margin financing - a key engine of the market's frenzied rally - and worsened by a tidal wave of initial public offerings that greatly increase share supply. Total of 20 companies started investor subscriptions for their initial public offerings (IPOs) this week, putting enormous pressure on liquidity. The new IPO subscriptions this week locked up about 6.7 trillion yuan of funds.
All the ten SSE industry groups closed down, with materials issue being top loser, down 8.3%, followed by industrials (down 7.3%), consumer staples (down 7.3%), telecommunication services (down 7.3%), energy (down 6.9%), consumer discretionary (down 6.7%), utilities (down 6.3%), healthcare (down 6.3%), information technology (down 5.7%), and financial (down 4.9%).
Hong Kong market rises 0.2%
The Hong Kong stock market closed modestly higher, as risk sentiments propelled by robust session on Wall Street overnight. The gain came despite speculation of a possible Greek exit from the Eurozone and sharp plunge in the Mainland China A-share market today amid increasingly wary of what many analysts describe as a bubble. The Hang Seng Index advanced 65.87 points or 0.25% to finish at 26760.53, off an intra-day high of 27011.95 and day low of 26701.72. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, surrendered 77.32 points, or 0.58%, to 13186.05 points. Turnover increased to HK$140.61 billion from HK$106.2 billion on Thursday.
In Hong Kong, several top-weighted stocks posted substantial gains, with Asian life insurer AIA Group up 1.7%, China Construction Bank Corp up 0.8%, and telecoms giant China Mobile up 0.6%. HSBC (00005) edged up 0.14%. However, China Resources (00291) fell 3.3%, giving up gains after yesterday's rally on the increased sale price of its non-beer business.
West China Cement plunged 10.6% on its placing with China's largest cement manufacturer Anhui Conch (00914), which was also down 2.8%, to sell 903 million new shares, or a 16.7% stake.
China Aircraft Leasing Group tumbled 19.2% after the resignation of its Chief Executive Officer and executive director Poon Ho Man.
Sensex attains 2-1/2-week closing high
Indian stock market closed higher on expectations that above-average monsoon rain, data showing higher water storage in reservoirs and a restrained increase in minimum support prices for Kharif crops announced by the government on Wednesday, 17 June 2015, will improve the odds for further monetary policy easing from Reserve Bank of India (RBI). The S&P BSE Sensex rose 200.34 points or 0.74% to settle at 27,316.17, its highest closing level since 1 June 2015. The CNX Nifty rose 50.35 points or 0.62% to settle at 8,224.95.
Bank stocks edged higher on renewed buying. Index heavyweights HDFC, ITC and Reliance Industries edged higher. Hindalco Industries edged higher after the Life Insurance Corporation of India (LIC) hiked its stake in the company to 13.337% from 11.328% in the last two months. L&T edged higher after the company said that its construction division has secured orders worth Rs 2278 crore across various business segments in May and June 2015. Shares of public sector oil marketing companies (PSU OMCs) edged higher. Shares of upstream oil exploration and production (E&P) firms also edged higher.
Foreign portfolio investors (FPIs) sold Indian shares worth a net Rs 784.73 crore yesterday, 18 June 2015, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 1110.01 crore yesterday, 18 June 2015, as per provisional data released by the stock exchanges.
Elsewhere in the Asia Pacific region: South Korea's KOSPI rose 0.3% to 2047. New Zealand's NZX50 added 0.6% to 5781.76. Singapore's Straits Times index added 0.02% at 3301. Malaysia's KLCI rose 0.2% to 1721.77. Indonesia's Jakarta Composite index climbed up 0.8% to 4985.01. Taiwan stock market was shut for a holiday.
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