Thursday, October 4, 2012

Asia stocks up on mildly positive US data

BANGKOK (AP) — A pair of positive U.S. economic reports helped prod Asian stock markets higher Thursday. A report showed U.S. service companies grew last month at the fastest pace in six months.


A separate report said American companies engaged in a modest amount of hiring in September.

Those hints of improvement in the world's biggest economy helped propel Japan's Nikkei 225 index up 1.1 percent to 8,844.85.

Australia's S&P/ASX 200 gained 0.3 percent to 4,452.20. Benchmarks in India, the Philippines, Thailand and Indonesia also rose. New Zealand and Taiwan fell.

Hong Kong's Hang Seng rose 0.2 percent to 20,929.27, continuing to benefit from the Chinese Communist Party's long-overdue announcement on Friday that a party congress is scheduled for Nov. 8, when President Hu Jintao will step down as party boss and Vice President Xi Jinping will succeed him.

"It means political stability is enhanced in mainland China," said Linus Yip, strategist at First Shanghai Securities in Hong Kong.

Japanese export shares soared on the prospect of a healing economy in the U.S. — a key market for Japanese goods including high-end vehicles.

Toyota Motor Corp. jumped 3.8 percent and Nissan Motor Co. soared 4.8 percent. But regional energy companies fell on slumping oil prices. Hong Kong-listed China National Offshore Oil Corp., known as CNOOC, dropped 1.3 percent.

Sinopec, Asia's largest oil refiner, lost 0.8 percent in Hong Kong. Some investors remained cautious due to events in Spain.

Prime Minister Mariano Rajoy denied this week that his government was about to ask for financial aid as it seeks to get a grip on its public finances.

Spain is under pressure to ask for financial assistance from the European Central Bank to keep a lid on its borrowing costs but the government has been reluctant to do so because it may come with conditions on its budget.

Germany is also pushing Madrid to delay such a move because the government in Berlin is wary of presenting yet another rescue plan for a vote in parliament.

Spain's borrowing rates have come down since September when the ECB announced a new plan to buy government bonds of struggling euro countries. On Wednesday, the interest rate on the country's 10-year bond was flat around 5.75 percent.

Wall Street edged higher Wednesday after the Institute for Supply Management said its index of service companies, which includes everything from financial firms to clothing stores, rose in September to the highest level since March. The index reached 55.1.

Economists had estimated it would drop to 53.4. Additionally, payroll provider ADP said U.S. companies added 162,000 jobs in September, a modest level of hiring.

The Labor Department will release its September employment report on Friday.

Economists consider the government figures more reliable. The Dow Jones industrial average rose 0.1 percent to close at 13,494.61.

The S&P 500 index rose 0.4 percent to 1,450.99. The Nasdaq composite rose 0.5 percent to 3,135.23.

Benchmark oil for November delivery was up 17 cents to $88.31 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell $3.75, or 4.1 percent, to $88.14 per barrel in New York on Wednesday.

That was the biggest decline since May 4 when oil fell $4.05 per barrel. In currencies, the euro rose to $1.2930 from $1.2899 late Wednesday in New York. The dollar rose to 78.58 yen from 78.52 yen.

yahoo.com

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