The main US indices all gained on Friday overnight due to Yellen's hawkish speech, led by the financial and telecommunication sectors. The Dow Jones Industrial Average Index edged up 0.25%, or 44.93 points, to close at 17,873.22, while the S&P 500 closed 0.43% higher at 2,099.06, and the Nasdaq market increased 0.65% to close at 4,933.51. US stock markets will be closed on Monday for the Memorial Day holiday. European markets rose slightly on Friday as the German DAX gained 0.13% to 10,286.31 and France's CAC 40 inched up 0.05% to 4,514.74.
However, gains were limited as investors' anxiety over the U.S. central bank's plan to raise interest rates after more hawkish comments from Fed officials. US Federal Reserve chairwoman Janet Yellen said in a speech at Harvard University that an interest rate hike in coming months would probably be appropriate, given the country's economy continues to improve.
St. Louis Fed president James Bullard said today that "markets are well-prepared for a possible rate increase globally". Traders are pricing in a 30% chance the Fed will increase rates in June, up from 4% earlier this month. July shows a 54% probability of higher U.S. borrowing costs, up from 51% earlier Friday.
Among Asian bourses
Australia Market closes near 9-month peak
Australian share market closed slight higher, as gains in consumer staple, energy, realty, and consumer discretionary stocks were more than offset by losses in materials & resources and banks & financials stocks. At close of trade, the benchmark S&P/ASX 200 index inclined 2.10 points, or 0.04%, to 5408. The broader All Ordinaries added 3.90 points, or 0.07%, to 5473.60.
ALS posted a full year loss of A$240.7 million as the oil and gas sector dragged down the rest of the analytical testing business. Its shares closed more than 7% lower at A$4.17.
News that vitamin company Blackmores was having trouble convincing Chinese customers of the quality of its infant formula product sent its shares tumbling. They lost more than 4% down to close at A$151.50.
Qantas's latest traffic statistics showed no improvement since the airline warned last month that domestic travel has slowed in Australia as the nation heads towards a federal election. Qantas closed 3.3% higher at A$3.10.
Cleaning company Spotless Group Holdings jumped 6.2% after it reaffirmed its earnings forecast and announced it may be selling its laundry business.
Japan Stocks rise on weaker yen, sales tax hike delay hopes
The Japan share market advanced on the back of yen depreciation against the dollar and on media reports that a planned hike in the country's consumption would be delayed. The 225-issue Nikkei average spurted 233.18 points, or 1.39%, to close at 17068.02. The Topix index of all first-section issues finished up 716.08 point, or 1.19%, at 1366.01.
Japan's Prime Minister Shinzo Abe told senior ruling party officials that he wants to delay raising the sales tax again, this time by more than two years, media reports said during the weekend. Deputy Prime Minister and Finance Minister Taro Aso and Liberal Democratic Party Secretary-General Sadakazu Tanigaki, a former finance minister, are opposed to Abe's idea of yet another delay in the tax hike, from April next year until October 2019, the reports said. Aso told Abe that if the government were to postpone the tax hike, which is designed to help finance growing social security costs and thus trim the huge public debt, the Prime Minister would have to dissolve the Lower House and call snap elections.
Shares of exporters closed sharply higher after yen jumped above 111 levels against greenback for the first time since late April. A weaker yen is generally a positive for exporter as it increases overseas profits when converted into local currency. Soy sauce maker Kikkoman Corp, which gets 47% of revenue from North America, surged 2.8% to 3930 yen. Subaru automaker Fuji Heavy Industries, which relies on North America for 60% of sales, added 3.8% to 4120 yen. Among other blue chip exporters, Sony Corp rose 0.1% to 3082 yen and Panasonic Corp 3.1% to 995 yen, meanwhile Toyota Motor Corp grew 1.7% to 5681 yen, Nissan Motor Co 3.8% to 1105 yen, and Mazda Motor Corp. 3.7% to 1861 yen. Alps Electric Co. added 3.1% to 2174 yen and TDK Corp 2.4% to 6430 yen. Robotics firm Fanuc Corp was up 2.4% to 16735 yen.
China Stocks closes marginally up
Mainland China stock market finished marginally higher in lighter volume amid uncertainty over the monetary policy outlook as the economy fails to show signs of a sustained recovery. Growing uncertainty over China's monetary policy and economic health is keeping investors from making bets in the country's stock and money markets. The CSI300 index of the largest listed companies in Shanghai and Shenzhen rose 0.14%, to 3,066.71, while the Shanghai Composite Index added 0.05%, to 2,822.45 points.
Total of 7 out of 10 SSE sectoral indices declined, with material issue leading loss, down 0.5%, followed by energy down 0.4% and IT down 0.3%. Telecommunication services issue ended 1.5% stronger and financial rose 0.8%.
CRRC Corp. advanced 4.4% companies after the nation's only maker of high-speed locomotives announced plans to raise as much as $1.8 billion in a private share sale to repay debt and help finance its daily operations.
Hong Kong Market rises 0.26%
The Hong Kong stock market advanced on tracking positive lead from US markets on last Friday after Federal Reserve Chair Janet Yellen said a rate hike in the coming months. The benchmark Hang Seng Index advanced 52.62 points, or 0.26%, to 20629.39 points. The Hang Seng China Enterprises Index, benchmark measure of performance of mainland China enterprises, added 29.48 points, or 0.34%, to 8624.76. Turnover increased to HK$58.5 billion from HK$55.5 billion on Friday.
BOCHK (02388) completed the sale of NCB stake to China Cinda (01359). It earned HK$30 billion from the disposal. The bank is considering special dividend payout. BOCHK jumped 1.9% to HK$23.7. China Cinda edged up 0.4% to HK$2.47.
Goldman Sachs recommended CR Power (00836), Huadian Power (01071), and China Power (02380), noting their attractive 8% dividend yields. CR Power rose 3.5% to HK$11.94. It was the top blue-chip winner today. Huadian shot up 5.8% to HK$4.02. China Power surged 5.3% to HK$3.21. Huaneng Power (00902) added 3.4% to HK$5.2.
China Life (02628) gained 0.8% to HK$17.06 on talks that it has joined hands with RXR Realty to buy New York office tower for HK$12.8 billion.
Tingyi (00322) plunged 5.3% to HK$6.83, extending a 10% fall in the previous trading day, as JP Morgan, Jefferies and Daiwa Research all lowered their target prices for the noodle manufacturer.
AAC Tech (02018) soared 6% to HK$62.6 as its managing director said in the AGM that the company plans to expand its capacity by 25% this year. Sunny Optical (02382) also jumped 4.3% to HK$26.65.
Sensex, Nifty attain highest closing level in more than 7 months
Amid a divergent trend among various index constituents, the two key benchmark indices registered small gains. The barometer index, the S&P BSE Sensex, rose 72 points or 0.27% to settle at 26,725.60. The Nifty 50 index rose 21.85 points or 0.27% to settle at 8,178.50.
Hindalco Industries surged 12.03% after the company announced strong Q4 March 2016 results. Shares of state-run coal mining giant Coal India moved higher after announcing increase in coal prices. Tata Motors edged higher ahead of the announcement of its Q4 March 2016 results. Maruti Suzuki India (MSIL) edged lower after the company announced temporary suspension of manufacturing of cars from its Manesar and Gurgaon facilities due to fire accident at the Manesar facilities of its supplier Subros.
Bharat Heavy Electricals dropped after reporting dismal Q4 March 2016 results. But, the NTPC stock shrugged off weak financial performance for Q4 March 2016. Tech Mahindra edged higher after the company's announcement that it has entered into an agreement to acquire UK based Target Group for an enterprise value of GBP 112 million.
State Bank of India (SBI) extended gains registered during the previous trading session after the bank's Chairman Arundhati Bhattacharya said in a post-result conference call held on Friday, 27 May 2016, that bank proposes to contain fresh slippages ratio within 2.7% of advances in the year ending 31 March 2017 (FY 2017).
Elsewhere in the Asia Pacific region: New Zealand's NZX50 inclined 0.39% to 7019.64. South Korea's KOSPI index dropped 0.1% to 1967.13. Taiwan's Taiex index grew 0.85% to 8535.87. Malaysia's KLCI fell 0.45% to 1629.87. Indonesia's Jakarta Composite index added 0.44% to 4836.03. Singapore's Straits Times index fell 0.2% to 2796.75.
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