The gains in the regional bourses came on account of upbeat manufacturing data from China, Europe and the United States. The Euro zone manufacturing PMI was revised up 0.2 points to 50.3 in July on the back of a stronger German reading which was revised up 0.4pts to 50.7. China's official manufacturing Purchasing Managers' Index unexpectedly rose to 50.3 in July, from 50.1 in June...
In US economic data, the ISM manufacturing reading posted a large upside surprise in July. The headline index jumped 4.5 points to 55.4 in July - a two year high. The production sub-index soared to 65.0, new orders to 58.3, the employment reading to 54.4. US Initial jobless claims dipped by 19k to 326k in the final week of July - a five year low.
However, gains on the upside were largely limited as markets are waiting for another piece of important economic data from US today. The non-farm payroll report is expected later in global day.
The ADP employment report showed 200k growth in the private sector. Initial jobless claims dropped 19k to 326k in the week ended July 27, the lowest level since January 2008. The employment component of ISM manufacturing was very encouraging, which rose from 48.7 to 54.4 in July, hitting the highest level in more than a year.
Meanwhile, gains were also capped amid concerns about the Federal Reserve tapering of its $85-billion-a-month bond buying program after a string of solid economic data released earlier this week.
In the Asia Pacific market, Japanese stocks surged sharply, with the Nikkei Stock Average rising 3.29% to 14,466.16 on the back of a firmer US dollar, upbeat earnings results and a positive data out of the US. Meanwhile, repeat buying of stock index futures further propelled buying spree. The announcements of solid corporate earnings for the April-June quarter also prompted investors to buy shares.
The Japan Iron and Steel Federation reported on Friday that steel exports rose 2.2% YoY to 3.69 million tonnes in June 2013, marking the first increase in two months. The growth is due in part to increased exports to Asia of interim products used for cars and construction. Export competitiveness is rising against China and South Korea due to the weaker yen, the official added. Exports to Thailand rose 6.9% to 460,000 tonnes on expanding automotive output there. Exports to Taiwan rose 13.6% to 360,000 tonnes. Meanwhile, exports to South Korea fell 5.7% to 660,000 tonnes, while exports to China fell 0.7% to 490,000 tonnes.
Australian stock market advanced for 10th straight session thanks to positive data out of the US that providing a strong lead for local shares. The benchmark S&P/ASX200 rose 1.1% to 5116.80.
Mining and energy stocks climbed up in Australia on the back of gains in base metals and oil overnight. Global miners BHP Billiton gained 1.5% to A$35.69, while Rio Tinto grew 2.2% to A$59.19 and FMG was up 3.5% to A$3.80. Top energy producer Woodside Petroleum jumped 1.2% to A$38.70, while smaller player Origin Energy rose 0.3% to A$12.20 and Santos 1.5% to A$13.96.
Resmed (RMD) shares rose 2.6% to A$5.46 after the company announced its full year results. The sleep apnoea equipment maker reported revenue of US$S414 million over the fourth quarter, up from US$371 million a year earlier. RMD has lifted its final dividend by 47% to $0.25 per share.
Australian Bureau of Statistics data that the producer price index (PPI) at the final stage of production rose 0.1% in June quarter, lower than the 0.3% rise in March quarter. The PPI is a measure of prices at the factory or farm gate before transport and other costs are added.
China stock market benchmark Shanghai Composite closed edge up 0.02% to 2029.42. The benchmark index gained 0.9% this week, paring its annual loss to 11%.
Chinese developers advanced amid growing speculation over relaxation policy on the industry after the Politburo endorsed development of the real estate market as part of efforts to ensure steady economic expansion. China Vanke Co advanced 2.5% to 9.98 yuan. Poly Real Estate Group Co added 3.7% to 10.93 yuan. China Merchants Property Development Co. gained 3.6% to 28.44 yuan.
Shares in solar equipment makers advanced in China on reports China will offer a 50% rebate on value-added taxes for photovoltaic stations projects. Hareon Solar Technology Co climbed 2.3% to 6.67 yuan, EGing Photovoltaic Technology Co 2.1% to 10.13 yuan and Risen Energy Co. 4.3% to 7.07 yuan.
Hong Kong's Hang Seng Index jumped 0.46% to 22,190.97 following the US rally. Among the 50 HK blue chips, 33 stocks rose, while 13 fell and remaining 4 stocks closed steady. Both China Mobile and HSBC nudged up 0.4% to HK$83.15 and HK$88.8. Hutchison gained 4.5% to HK$91.65 on a slew of target price upgrades from brokerages. Cheung Kong also added 1.7% to HK$113.5. Elsewhere, baby product manufacturers rose across the board on talks of lessening of one-child policy in China. Goodbaby, Prince Frog and Lerado soared more than 8% to HK$3.19, HK$5.43 and HK$0.78.
Indian stock market declined for eighth straight session, with the 30-share Sensex down by 153.17 points to 19164.02, on back of selling pressure in rate-sensitive shares as investors remained uncertain as to when the central bank will rollback its short-term rate hike aimed to curb rupee's fall. 30-share Sensex dropped 115 points to trade at 19,201 while Nifty declined 41 points at 5,681.
Bank shares in India declined steeply on worries about declining asset quality and after the Reserve Bank raised short term rates. The Reserve Bank of India Governor said on Friday the central bank would roll back recent cash tightening measures only after it determines stability has been restored in the foreign exchange market.
Power Grid Corp of India falls after it announced a secondary offering on fears that state-run utility would price the offering at a discount to attract investor interest.
Elsewhere, New Zealand's NZX50 rose 0.82%, South Korea's Kospi Index (KOSPI) gained 0.14 and Taiwan's Taiex Index jumped 0.54%. Indonesia's JKSE Composite was up 0.36%, Singapore's Straits Times Index added 0.33% and Malaysia's KLSE Composite climbed 0.26%.
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