The Commerce Department reported on Friday, 20 December 2013, that US gross domestic product grew much faster 4.1% in the third quarter than previously estimated 3.6%, as consumers stepped up spending on services such as health care and companies invested more in software.
International Monetary Fund (IMF) Managing Director Christine Lagarde said on Sunday IMF will raise its outlook for the U.S. economy, as a budget deal in Washington and the Federal Reserve's plan to taper bond buying ease doubts about the future.
Among Asian bourses, shares on the Australian financial market extended winning streak for third session in row, bolstering the benchmark S&P/ASX 200 index by 26.70 points to finish at 5291.90, amidst positive cues from US markets.
Australian top four banking shares ended with strong gains after Australia's bank regulator told the group to increase their capital buffers. Australian Prudential Regulation Authority said on Monday that the big four banks must increase the amount of capital they set aside to absorb losses by an extra 1 percentage point from January 2016. The changes, which were broadly consistent with economist expectations, are designed to reduce the risk to the broader Australian economy of a financial institution deemed by the regulator to be systemically important failing. Among lenders, Commonwealth Bank added 1.1% to A$76.76, Westpac Bank 1.1% to A$31.92, National Australia Bank 1.1% to A$34.62 and Australia & New Zealand Banking Group 0.5% to A$31.95.
Newcrest Mining (NCM) was down 2.1% to A$7.54 after disclosing that it was meeting with a law firm that has threatened the gold miner with a lawsuit over its disclosure practices.
Health insurer nib Holdings (NHF) rose 2.5% to A$2.50. The government has approved an increase in NHF's premiums to come into effect in April next year.
Drilling company Boart Longyear (BLY) added 15.5% to A$0.41 after announcing it expects no major material change in its FY earnings from the October guidance already given to the market.
China- China's share market advanced for the first time in ten consecutive sessions as investors chased for value buying on hopes recent declines in blue chip shares were excessive as compared their earnings prospect. The Shanghai Composite rose 4.91 points to finish at 2089.71, while the CSI 300 Index added 6.46 points to close at 2284.60.
Market gains were, however, limited amid lingering concerns about liquidity crunch in the market. Chinese money market rates continued to rise on Monday despite 300 billion yuan liquidity injection by the People's Bank of China via Short-term Liquidity Operations (SLOs). The central bank's injection of funds to selected lenders failed to ease concern that liquidity will tighten before the resumption of share offerings next month. The benchmark seven-day repo rate was at 7.50%, while 1-month repo rate escalated to 9.80%. The overnight repo rate was at 4.62%.
The PBOC said the funds were added via Short-term Liquidity Operations (SLOs) over the past three days and noted that excess reserves in the banking system stand at over CNY1.5 trillion, saying that this was a relatively high level for this time of year. It urged banks to "reasonably" adjust their balance sheets and improve liquidity management.
Among Shanghai bluechips, Guizhou Bailing Group Pharmaceutical Co. surged on expectations the outbreak of the bird flu will boost medical expenditures. Tianjin Zhonghuan Semiconductor Co. retreated after receiving a warning from the regulator to disclose information.
In Hong Kong- stocks trekked higher in quiet trade, with benchmark Hang Seng Index provisionally ending 109.38 points higher at 22921.56, as positive cues from US markets outweighed concerns about a credit crunch in China.
Among the HK 50 blue chips, 32 rose and 13 fell, with 5 stocks remaining steady. Want Want China (00151) put on 2.8% to HK$10.92 while Hengan International (01044) fell 1.6% to HK$90.7, making both stocks the top blue-chip gainer and loser respectively.
Market heavyweights were higher. China Mobile (00941) rose 0.8% to HK$80.55 after Apple said it plans to start offering the iPhone on China Mobile's network from Jan. 17, while HSBC (00005) nudged up 0.67% to HK$82.55.
Hong Kong Television Network (01137) shot up 65.9% to HK$3.85 after the broadcaster that failed to get a new free-to-air license agreed to buy spectrum from a unit of China Mobile to offer mobile-phone TV services.
FIH Mobile (02038) gained 4.8% to HK$3.92 after it signed a strategic partnership with Blackberry for smartphones. CEC Int'l (00759) put on 9.4% to HK$3.72 after its interim profit surged 2.2 times.
China Everbright Bank, which on Friday raised HK$3 billion in Hong Kong's biggest initial public offering this year, fell for a second straight session on Monday, down 1% to HK$3.83. Investors have remained cautious over the level of bad debt at Chinese banks, particularly when interbank lending rates are high.
In economic news- the Census and Statistics Department stated on Monday that Hong Kong's overall consumer prices rose 4.3% in November over the same month a year earlier, same as that in October. After netting out the effects of all Government's one-off relief measures, the year-on-year rate of increase in the Composite CPI (i.e. the underlying inflation rate) in November was 4%, also same as that in October. On a seasonally adjusted basis, the average monthly rate of increase in the Composite CPI for the 3-month period from September to November was 1.2%, and that for the 3-month period from August to October was 0.4%. Netting out the effects of all Government's one-off relief measures, the average monthly rate of increase in the Composite CPI for the 3-month period from September to November was 0.4%, and that for the 3-month period from August to October was 0.3%. A Government spokesman commented that looking ahead, the subdued imported inflation and the moderated increases in fresh-letting residential rentals since early 2013 should help to contain the upside risks to inflation in the near team.
The Civil Aviation Department (CAD) on Monday approved the passenger fuel surcharges for January. The new maximum levels of fuel surcharges will be HK$218 for short-haul flights and HK$915 for long-haul flights, which represent decreases of 5% and 2% from the current maximum levels for short-haul and long-haul flights respectively. Passenger fuel surcharges are reviewed by the CAD on a monthly basis. In last month's review, the maximum surcharge levels for short-haul and long-haul flights approved by the CAD were HK$229 and HK$935 respectively.
India- Indian stocks logged marginal gains on first trading day of the week after witnessing high volatility during the last one hour or so. The barometer index, the S&P BSE Sensex, was up 21.31 points or 0.1%, off 106.86 points from the day's high and up 41.91 points from the day's low.
Shares of a number of small-cap and mid-cap companies rose for the second day in a row, boosted by stock market regulator Securities and Exchange Board of India's (Sebi) announcement on 19 December 2013 that it has decided to rationalize the rules on trading of thinly-traded stocks. BSE Small-Cap and Mid-Cap indices were up more than 1% each, with both these indices outperforming the Sensex.
Indian index heavyweight Reliance Industries (RIL) edged higher in choppy trade. Realty stocks extended Friday's gains as ICICI Bank joined State Bank of India and HDFC by cutting interest on home loans. Metal and mining stocks extended Friday's gains. Infosys dropped after the company after trading hours on Friday, 20 December 2013, announced the changes to the board of directors of the company.
Shares of biotechnology major Biocon surged. Cigarette maker ITC rose in volatile trade. Among IT stocks, HCL Technologies hit record high. Wipro hit 52-week high. Infosys dropped after the company after trading hours on Friday, 20 December 2013, announced the changes to the board of directors of the company. Shares of PSU OMCs rose after the state run oil marketing firms hiked petrol and diesel prices. Capital goods stocks rose. L&T gained after the company said it is in discussions with a large global institutional investor for a proposed acquisition of a stake in L&T's subsidiary viz. L&T Infrastructure Development Projects.
Elsewhere in the region, South Korea's KOSPI rose 0.68%. Indonesia's Jakarta Composite index fell 0.14%. Taiwan's Taiex index rose 0.57%. New Zealand's NZX50 index jumped 0.89%. Singapore's Straits Times index gained 0.7%. Malaysia's KLSE Composite shed 0.28%. Tokyo stock markets were closed for a holiday.
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