Asia Pacific share market traded higher on Friday, 23 January 2015, riding the wave of euphoria from the European Central Bank's announcement of massive quantitative easing that could help boost asset prices both inside and outside the eurozone. Meanwhile, market sentiments propelled further by rising expectations the Chinese central bank will move to ease liquidity to support the flagging economy.
Mario Draghi announced sovereign bond QE for the Eurozone, larger than expected in size. ECB president Mario Draghi said the central bank decided to launch an expanded asset-program encompassing the existing purchase programs of ABS and covered bonds. ECB will start buying EUR 60 billion in assets per month in March, until September 2016. That includes government bonds, debt securities issued by European institutions as well as private-sector bonds. The total will worth around EUR 1.1 trillion.
A recent batch of weak Chinese economic indicators, including a manufacturing activity survey on Friday, raised the prospect Beijing will roll out more measures. The HSBC/Markit Flash Manufacturing Purchasing Managers' Index survey showed China's manufacturing growth stalled for the second straight month in January and companies had to cut prices at a faster clip to win new business, adding to worries about growing deflationary pressures in the economy.
The HSBC/Markit Flash Manufacturing Purchasing Managers' Index (PMI) hovered at 49.8 in January, little changed from December's 49.6 and just below the 50-point mark that separates contraction from growth on a monthly basis.
Among Asian bourses
Australia market extends gain after ECB massive easing
Headline equities of the Australian market advanced, with the S&P/ASX 200 gaining 1.5% to 5501.80 and All Ordinaries Index rising 1.44% to 5468.20. The market sentiments boosted up on the back of larger-than-expected economic stimulus program from the European Central Bank, with the big miners and banks the prime beneficiaries. The benchmark S&P/ASX 200 Index and the broader All Ordinaries Index gained 3.8% and 3.6%, respectively, for the week.
Financial stocks closed higher, with top four lender leading rally. Westpac Banking Corp was up 1.4% to A$34.32, ANZ Banking Group 1.4% to A$32.20, National Australia Bank 1.3% to A$34.77 and Commonwealth Bank of Australia 1.2% to A$86.23. Meanwhile, rising equities helped Macquarie Group rally 2.6% to A$61.03, while market-sensitive QBE Insurance Group gained 0.6% to A$10.68 and AMP improved by 3.5% to A$5.60.
Shares of energy companies advanced, inline with a sharp rebound for crude-oil futures after news of the death of Saudi King Abdullah. Australia's biggest oil producer Woodside Petroleum climbed up 2.3% to A$34.40. Origin Energy grew 3% to A$10.85 and Santos jumped 5.1% to A$7.80.
Nikkei surges 1.05% on ECB stimulus plan
Japanese share market closed sharp higher, boosted by the European Central Bank's massive economic stimulus announcement. The Nikkei Stock Average ended higher 1.05% at 17511.75, while the broader Topix has gained 0.99% to 1403.22. The Nikkei 225 Stock Average added 3.8% this week.
Shares of currency-sensitive companies advanced after the dollar changing hands for 118.52 yen, up from around 118.05 yen at Thursday's Tokyo stock close. The euro moved sharply in the other direction, tumbling more than 2 full yen for a 1.8% loss to around 134.60 yen. Yet despite the weaker euro, some of the names with strong European exposure outperformed the market, as Mazda Motor Corp climbed 1% to 2560 yen and Toshiba Corp improved by 1% to 478.40 yen. Among other exporters, Fanuc Corp. rallied 3% to 20730 yen, Subaru maker Fuji Heavy Industries rolled 2.7% higher at 4346 yen. Softbank Corp improved by 4.2% to 7355 yen, extending gains from the previous session on a reported tie-up between Google Inc. and Softbank's listed U.S. subsidiary Sprint Corp.
Shares of Teijin gained 5% to 388 yen on brokerage price target upgrade. Nomura raised its price target for the company by 14% to 410 yen.
Yaskawa Electric rose 5.7% to 1,569 yen after the company boosted its full-year net-income forecast 4.4% to 23.5 billion yen and lifted its second-half divided outlook to 12 yen a share from 10 yen.
China market rises after PMI data
Mainland China share market advanced for fourth consecutive session, propped up by larger-than-expected quantitative easing program from the European Central Bank and rising expectations the Chinese central bank will move to ease liquidity to support the flagging economy. The benchmark Shanghai Composite Index rose 0.25% to close at 3351.76.
Shares of financial companies advanced sharply in Beijing on expectation that the PBOC will cut the reserve ratio before the holiday. Sealand Securities Co. rallied 8.6% to 16.61 yuan. China Life Insurance Co. jumped 2.6% to 40.24 yuan. Huaxia Bank Co. advanced 1.8% to 13.06 yuan. Citic Securities Co added 2.7% to 29.21 yuan and Haitong Securities Co added 1.8% to 21.71 yuan. Industrial & Commercial Bank of China climbed 2.1% to 4.98 yuan.
Hang Seng ends 0.7% up
Hong Kong share market closed higher, riding the wave of euphoria from the European Central Bank's announcement of massive quantitative easing that could help boost asset prices both inside and outside the eurozone. The Hang Seng Index ended higher by 327.82 points or 1.34% to 24850.45, off an intra-day high of 24896.22 and day low of 24726.77. Turnover increased to HK$106.06 billion from HK$99.45 billion on Thursday.
Within HK 50 blue chips, 45 stocks rose and 4 fell, while remaining 1 stocks unchanged. CHINA RESOURCES (0291) rose 6.7% to HK$18.12 after Deutsche Bank upgraded the stock to "buy", while WANT WANT CHINA dipped 2.7% to HK$9.14 after Nomura yesterday downgraded the stock to "reduce", making themselves the biggest blue chip winner and loser.
Shares of financial companies advanced, with companies with European exposure benefited the most, thanks to the ECB's QE program. HSBC (00005) put on 1.7% to HK$73.1, while StanChart (02888) gained 1.2% to HK$111.2
Hutchison Whampoa (00013) rose 3% to HK$101.2 after it announced plans to acquire O2 UK from Telefonica. The company will become the top telecom carrier in the UK upon the completion of the deal.
Sensex extends gain; breadth weak
Indian stock market further extended intraday gains in mid-afternoon trade. While the benchmark indices extended gains, the broad market depicted weakness. The market breadth indicating the overall health of the market was weak. At 14:16 IST, the S&P BSE Sensex was up 263.18 points or 0.91% at 29,269.20. The CNX Nifty was up 62.80 points or 0.72% at 8,824.20.
There are expectations that inflows from foreign funds into India will rise after European Central Bank (ECB) yesterday, 22 January 2015, announced a massive new bond-buying program to boost sluggish eurozone economy.
Mortgage lender HDFC and private sector bank HDFC bank, both, hit record high. Larsen & Toubro and Reliance Industries edged higher. Power generation stocks were mixed. Shares of pharmaceutical companies were mixed.
Foreign portfolio investors (FPIs) bought Indian shares worth a net Rs 592.79 crore yesterday, 22 January 2015, as per provisional data.
Elsewhere in the Asia Pacific region: Taiwan's Taiex index added 1.08% to 9470.94. South Korea KOSPI rose 0.79% to 1936.09. New Zealand's NZX50 jumped 0.5% at 5675.24. Singapore's Straits Times index advanced 1.22% at 3411.26. Indonesia's Jakarta Composite index was up 1.35% to 5323.08. Malaysia's KLCI added 1.35% to 1803.08.
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