Asian shares rose notably on Thursday, snapping recent steep losses, as Alcoa's surprise first-quarter profit, a decrease in Italian and Spanish bond yields and remarks by a European Central Bank official that indicated the ECB could resume bond purchases through its securities markets program encouraged investors to do some bargain hunting. A rebound in commodity prices overnight and better-than-expected employment data out of Australia and South Korea also helped investors shrug off fears over North Korea's imminent rocket launch.
Japanese shares rose for the first time in eight sessions, as a pause in the yen's resurgence and expectations of further monetary easing by the Bank of Japan helped lift heavyweight shares such as Fanuc and Hitachi Construction Machinery. The Nikkei average rose 0.7 percent, while the broader Topix index added half a percent.
Fanuc rose 2.7 percent, adding to the previous session's gains, while Hitachi Construction Machinery soared 4.1 percent amid a Nikkei report that the company will likely report a significant jump in consolidated operating profit for the business year ending in March 2013. Itochu advanced 3.8 percent on saying that it would acquire a 24.9 percent stake in Finnish pulp firm Metsa Fibre.
Nissan Motor ended 0.4 percent lower after data showed car sales in China rose a modest 4.5 percent in March year-over-year. Shipping companies like Kawasaki Kisen and Mitsui O.S.K. Lines fell 2-4 percent due to caution over the possible impact of North Korea's planned rocket launch, expected at any time over the coming days. Takeda Pharmaceutical dropped 0.4 percent after it agreed to buy Philadelphia-based URL Pharma for $800 million.
Chinese shares rallied, with the benchmark Shanghai Composite index climbing 1.8 percent to end higher for a third straight session, as the World Bank's downward revision of its Chinese growth estimate to a 13-year low of 8.2 percent in 2012 heightened expectations of further policy easing in the months ahead. The report assumed significance as it came ahead of China's official first-quarter gross domestic growth data due tomorrow. Hong Kong's Hang Seng index finished 0.9 percent higher, led by local banking shares.
Australian shares snapped a four-session losing streak, as strong jobs data coupled with easing concerns about sovereign funding for debt-laden Spain and Italy boosted sentiment. Both the benchmark S&P/ASX 200 and the broader All Ordinaries index rose around 0.8 percent each. Global miner BHP Billiton rose 0.9 percent and Rio Tinto added 1.5 percent, but smaller rival Fortescue edged down 0.4 percent. Iluka Resources ended unchanged after the minerals sands miner posted a 13 percent fall in first-quarter revenue. Among the major banks, Commonwealth, Westpac, ANZ and NAB rose between 0.3 percent and 1.2 percent.
The Australian dollar climbed against the U.S. dollar and the yen after data from the Australian Bureau of Statistics showed Australia's employment rose more than expected in March. Employment rose by 44,000 from a month earlier in March, much higher than economists' expectations for an increase of 6,500, while the seasonally adjusted unemployment rate held steady at 5.2 percent compared with expectations for an increase to 5.3 percent.
South Korea's Kospi average ended 0.4 percent lower, as local shares played catch up with regional markets after a holiday yesterday for the nationwide parliamentary elections. Also, investors adopted a wait-and-see approach amid caution about a possible North Korean rocket launch in defiance of international warnings. Tech shares such as Samsung and LG Electronics dropped around 3 percent each and Hyundai Motor, the country's largest automaker, lost a percent, while crude refiner SK Innovation rose 2.5 percent and steelmaker POSCO added 1.4 percent.
On the macroeconomic front, a government report today showed that the country's unemployment rate fell for the first time in five month in March, with the seasonally adjusted unemployment rate falling to 3.4 psercent in the month from February's 11-month high of 3.7 percent. Economists had expected only a modest fall to 3.6 percent. In unadjusted terms, the jobless rate dropped to 3.7 percent from 4.2 percent in February.
New Zealand shares followed regional shares higher, as better than expected employment data out of Australia and the Fed's latest "beige book" report of regional economies, which noted that the U.S. economy grew in all 12 of its regions, eased worries about tepid global growth. The benchmark NZX-50 index rose 0.6 percent.
Heartland New Zealand, the would-be bank, led the gainers on the exchange, climbing 8.2 percent. Vector gained 3 percent and Fletcher Building added 2.2 percent, snapping a six-day losing streak. Michael Hill International rose 2.9 percent after the jeweler posted flat same-store sales for the nine-months ended March 31. Chorus, Telecom's network arm spun off in November, ended unchanged after the company announced its first drawdown on the $929 million subsidy it's receiving to build high-speed internet links in Auckland.
Elsewhere across Asia, India's benchmark Sensex was up 0.8 percent, Indonesia's Jakarta Composite index edged up 0.2 percent, Malaysia's KLSE Composite gained 0.3 percent, Singapore's Straits Times was up 1.1 percent and the Taiwan Weighed average rose marginally.
On Wall Street, stocks turned in a strong performance overnight, regaining some ground after recent sharp losses, as investors cheered aluminum giant Alcoa's quarterly results and the Fed's latest Beige Book report, which showed that the economy continued to expand at a moderate pace from mid-February through late March. Paring some early gains, the Dow and the S&P 500 ended up around 0.7 percent each, while the tech-heavy Nasdaq rose 0.8 percent.
by RTT Staff Writer
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