Asia stocks in silent gains
Asian stock markets posted muted gains Tuesday as investors awaited the outcome of the U.S. midterm elections and the Federal Reserve’s two-day meeting amid speculation over stimulus programs.
Oil prices rose above $83 a barrel in Asia as stronger manufacturing in the world’s two biggest economies — the U.S. and China — boosted optimism that demand for crude will improve.
The Australian dollar jumped more than one U.S. cent to nearly $1 after the central bank jacked up its key interest rate in a surprise move that aims to ward off higher inflation as Australia’s economy booms amid strong Asian demand for iron ore and other minerals.
Japan’s benchmark Nikkei 225 stock index rose 4.8 points, or 0.1 percent, to 9,160.07 and South Korea’s Kospi was up 0.2 percent to 1,918.08. Australia’s S&P/ASX 200 added 0.1 percent to 4,701.40.
Hong Kong’s Hang Seng index rose 0.1 percent to 23,668.74.
Markets in Taiwan and Indonesia were lower while those in Thailand, New Zealand, the Philippines and Singapore rose.
The Shanghai Composite Index was also up — one day after China released data showing faster growth in manufacturing — and analysts said Chinese stocks were poised for more gains. The index rose 0.8 percent to 3,087.30.
“We remain bullish on China in coming months,” Citigroup said in a report.
Factors such as the faster appreciation of the yuan, steps taken to dampen the property boom, and the impending action by the U.S. central bank “continue favoring the equity market in the near-term … the market should gain solid footing after some near-term corrections.”
The U.S. also posted growth in manufacturing, a report showed Monday, due to demand at home and abroad for cars, computers and other goods.
Analysts said the report by the Institute for Supply Management suggests that U.S. manufacturing was beginning to reap the benefits of a weak dollar, which helps boost American exporters by making U.S. goods cheaper overseas.
The report boosted stocks early in the day Monday, but Wall Street was unable to hold on to the gains. The Dow Jones industrial average closed almost flat ahead of the outcome of Tuesday’s U.S. congressional elections and the Fed’s policy meeting on Nov. 2-3. The Dow was up just 6.13 points, or 0.1 percent, to 11,124.62.
Investors have expected the Fed to announce a new program of buying Treasury bonds as early as Wednesday in a bid to help stimulate the U.S. economy.
In currencies, the euro rose to $1.3925 from $1.3897 in New York late Monday. The dollar slumped to 80.21 yen early Monday, hovering near a post-World War II record low of 79.75 yen set in 1995. In Tokyo on Tuesday, the dollar crawled back to 80.54 yen.
Benchmark oil for December delivery was up 41 cents at $83.36 a barrel in electronic trading on the New York Mercantile Exchange. The contract jumped $1.52 to settle at $82.95 on Monday.
Source: AP