China's factories boosted output in June, according to gauges released Tuesday, in a sign that government stimulus efforts are injecting vigor into the economy. The National Bureau of Statistics and China Federation of Logistics and Purchasing said on Tuesday that the manufacturing Purchasing Managers' Index was at 51.0 in June increasing from May's 50.8. A similar index from HSBC Holdings Plc and Markit Economics rose to 50.7 from the previous month's 49.4. Numbers above 50 signal expansion.
Higher monthly results for two measures of manufacturing activity announced today came on the heels of improvements in exports, industrial production and retail-sales data in recent weeks. Some economists said the slew of more positive data suggests that Beijing has managed to put a floor under sliding growth, at least for now.
Premier Li Keqiang recently promised that the government will deliver the growth target of 7.5% this year, indicating that the overall policy stance will become more supportive for growth in the second half of this year."
Manufacturing in India grew for an eighth consecutive month in June, according to the HSBC Holdings Plc and Markit Economics purchasing managers index today. The gauge rose to 51.5, the highest level since February, from 51.4 in May. A reading of more than 50 indicates expansion.
Among Asian bourses
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Australia market falls 0.37%
Australian share market finished first session of new financial year in negative terrain after moving in and out of neutral line. The losses was largely due to losses in shares of property trusts, financials and realty counters amidst profit taking, while strength in bullion, mining, and industrial stocks helped to cap downfall. The benchmark S&P/ASX200 declined 0.37% to 5375.90 while the broader All Ordinaries sank 0.29% to 5366.50.
Shares of material and resources companies closed stronger today, helped by better manufacturing data from China. The National Bureau of Statistics and China Federation of Logistics and Purchasing said today in Beijing that the manufacturing Purchasing Managers' Index was at 51.0 in June increasing from May's 50.8. A similar index from HSBC Holdings Plc and Markit Economics rose to 50.7 from the previous month's 49.4. Numbers above 50 signal expansion.
Resources giant BHP Billiton added 0.3% to A$36, while Rio Tinto rose 1.9% to A$60.45 and iron ore miner Fortescue Metals Group was up 0.2% to A$4.36. Mount Gibson shares (MGX) ended at 70.5 cents a gain of 1.5 cents or 2.2%.
The Reserve Bank of Australia has kept its benchmark cash rate at a record low 2.5% at the July RBA Board meeting on Tuesday. The main points to emerge from the post meeting statement were same as those from last month. The RBA is sticking with its view that Australian economic growth will be below the long term trend for the year ahead. Other points of mention included the residential construction upturn being described as strong which not a word central banks use much these days. Significantly, there was no discussion of the post budget drop in consumer confidence.
Nikkei rises 1.1% on Tankan data
Japan share market finished the session sharp higher, lifted by the central bank's Tankan survey data for June that indicated companies raised their investment plans more than forecast. The Nikkei 225 index advanced 1.08% to finish at 15326.20, while the Topix index of all first-section issues rose 1.07% to 1276.08.
The Bank of Japan has released its quarterly Tankan business survey for April-June quarter on Tuesday, showing that sentiment among major manufacturers fell to +12 in June quarter from +17 in March quarter, hit by temporary pullback in consumption caused by the April sales tax hike. But sentiment for the sector is expected to improve slightly to +15 in September as recent data have shown that demand for some goods and services is recovering. Business investment plans for this fiscal year through March 31, 2015 among large firms are forecast to rise 7.4%, revised up sharply from +0.1% projected in March.
Shares of exporters and financials rose. Toyota Motor Corp rose 1.4% to 6,169 yen and Mitsubishi UFJ Financial climbed 1.3% to 629 yen. Industrial firms also advanced, with Keyence Corp. rising 3.2% to 45,625 yen and Fanuc Corp. gaining 2.3% to 17,870 yen.
Materials and resources stocks were higher, after prices of the base metal climbed to the highest since February 2013 in London yesterday. Pacific Metals added 5.9% to 522 yen. Toho Zinc Co. surged 4.5% to 395 yen.
Shares of Japanese consumer finance firms declined after Finance Minister Taro Aso said he wasn't considering relaxing consumer lending rules now. The shares surged yesterday on a report that the government was weighing easing regulations on some lenders. Aiful Corp. slumped 2.6% to 636 yen and Acom Co. retreated 8.5% to 441 yen.
Square Enix advanced 6.5% to 1,910 yen after the gamemaker President Yosuke Matsuda announced plans to boost Asia revenue outside Japan to as much as 40% of its total within several years. The company, which now gets less than 2% from the wider region, is seeking more Chinese partners to expand sales.
China stocks rise on better manufacturing data
Mainland China share market closed volatile session marginally higher, lifted by report showing an expansion in manufacturing PMI in June. The benchmark Shanghai Composite closed 0.1% higher from prior day to 2050.38. Trading turnover increased to 83.5 billion yuan from yesterday's 80.01 billion yuan.
Shares of technology companies surged the most in Shanghai market. Yonyou Software Co. surged 10% daily limit to 15.48 yuan. Shanghai Lianming Machinery Co. rose 10% daily limit to 15.73 yuan. Guangdong Ellington Electronics Technology Co spurted 44% to 22.05 yuan after listing shares in the Shanghai bourse.
Materials and resources stocks were higher, after prices of the base metal climbed to the highest since February 2013 in London yesterday. Jiangxi Copper Co, the biggest producer of the metal, surged 3.4% to 12.69 yuan. Aluminum Corp. of China advanced 0.7% to 3.06 yuan.
Sensex rises to three-week high
India's benchmark stock index rose toward a three-week high in mid-afternoon trade, led by metal producers and automakers, after capping their best quarterly advance in almost five years. At 14:20 IST, the S&P BSE Sensex was up 135.37 points or 0.53% to 25,549.15. The index jumped 142.50 points at the day's high of 25,556.28 in afternoon trade, its highest level since 18 June 2014.
Realty stocks gained on renewed buying. DLF (up 0.07% to Rs 215.30), Housing Development & Infrastructure (HDIL) (up 1.98% to Rs 102.90), Unitech (up 0.3% to Rs 33.90) and Anant Raj (up 3.65% to Rs 78.15) gained.
Airline stocks shrugged off a small hike of jet fuel prices. Jet Airways India (up 2.93%) and SpiceJet (up 1.83%) gained. The price of jet fuel or aviation turbine fuel (ATF), at Delhi was increased by Rs. 413.78 per kilolitre (kl), or 0.6%, to Rs. 70,161.76 per kl effective 1 July 2014. Jet fuel constitutes over 40% of an airline's operating costs.
Shree Cement rose 0.5% to Rs 7,282.45. The company said during market hours that it has commissioned a grinding unit of 2 million tons per annum (MTPA) capacity at Aurangabad in Bihar on 30 June 2014. Separately, the company said it has lighted up its clinker manufacturing unit having capacity of 6,000 ton per day (TPD) at Bangur City, Ras in Pali District of Rajasthan on 30 June 2014.
Hindalco Industries climbed to a three-year high after CLSA Asia-Pacific Markets forecast the company's share price will double in four years.
Elsewhere in the Asia Pacific region- Taiwan's Taiex index was up 0.52% to 9441.92. South Korea's KOSPI index fell 0.16% to 1999. Indonesia's Jakarta Composite Index added 0.13% to 4884.83. Malaysia's KLSE Composite fell 0.19% to 1879.12. Singapore's Straits Times index fell 0.4% to 3242.64. New Zealand's NZX50 added 0.1% to 5146.26. Hong Kong stock market was shut for the anniversary of the city's return to Chinese rule in 1997.
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