News Column

Asian Stocks Tad Higher On US Optimism

July 21, 2014

CANBERA (Alliance News) - Asian stocks ended mostly higher on Monday as concerns about geopolitical tensions appeared to ease and investors shifted their attention to upbeat earnings reports from US companies. US stocks rebounded significantly from the previous session's sell-off on Friday, perking up investor sentiment. The Japanese market was closed for a public holiday.

Chinese shares drifted lower, ending in the red for the third time in four days, as earnings concerns resurfaced and investors braced for a deluge of initial public offerings. The benchmark Shanghai Composite index slipped 0.22% to 2,054.48. Hong Kong'sHang Seng index, meanwhile, dropped 0.29% to 23,387.14.

Australian shares posted modest gains as investors went bargain hunting shrugging off geopolitical concerns. The benchmark S&P/ASX 200 rose 0.2% to 5,540, a six-year high. The big four banks ended mixed showing little change, while insurer QE Insurance Group rallied 2% and Suncorp Group added a percent. Mining giant BHP Billiton slid 0.4%, Rio Tinto shed 0.9% and smaller rival Fortescue Metals Group declined 0.4%. Mining and materials company Arrium tumbled 3.2% after flagging concerns over market prices.

Crown Resorts advanced 1.3% as it entered into a deal to develop a casino in Brisbane. Fairfax Media rose 1.7% on reports Gina Rinehart may launch a takeover bid for the country's second-largest newspaper publisher. Boart Longyear shares soared 21%. The mining firm said that S&P's rating downgrade does not impact any of the company's bank covenants.

Port operator Asciano slipped 0.2% after confirming that it was in talks with third parties over a possible sale of a non-controlling interest in its terminal and logistics business. Property developer Australand edged down 0.2% despite the company reporting a 49% jump in first-half net profit on the back of strength in the residential property sector. Zicom Group dropped almost 20% after issuing a profit warning.

Seoul shares fell on institutional selling as investors awaited cues from the second-quarter earnings season. The benchmark Kospi average slipped 0.05% to 2,018.50, extending losses for the second session in a row. Institutions offloaded shares worth a net 134 billion won, extending their selling streak for the 15th day, while overseas investors bought shares worth a net 177 billion won, preliminary data showed. LG Chem tumbled 4.2% on disappointing Q2 results.

New Zealand stocks rose as investors looked ahead to the start of the earning season next month. The benchmark NZX-50 index gained 0.35% to finish at 5,126.90. Air New Zealand climbed 4.6% as tensions subsided for now over the downing of Malaysian Flight 17. Mighty River Power, Contact Energy, Telecom Corp and Sky Network Televison rose 1-2%, while milk marketing firm A2 Milk plunged 6.2% and biotech company Pacific Edge slumped 5.6%.

In economic releases, total credit card billing in New Zealand grew 7% in June from a year earlier after rising 7.6% in the previous month, central bank data showed. On a monthly basis, credit card spending rose 0.7%, slower than a 3.2% increase in May. Another report showed that New Zealand saw 162,100 visitors in June, up 2,600 from a year earlier and surpassing the previous June high of 159,500 in 2013.

Indonesia's Jakarta Composite index was up 0.8% before the result of disputed presidential elections due this week.

India's Sensex was moving up 0.5%, gaining for a fifth day, as Reliance Industries posted better-than-expected quarterly results and the Indian Meteorological Department reported a fall in rainfall deficit across the country, bringing some relief to policymakers worried about rising food prices.

Elsewhere, Malaysia's KLSE Composite was down 0.2%, while Singapore's Straits Times index was up marginally and the Taiwan Weighted average advanced 0.4%.

US stocks posted solid gains on Friday as investors reacted positively to the latest batch of earnings from companies such as Google and Honeywell. In economic news, a gauge of consumer sentiment unexpectedly fell to its lowest level since March in July, while the Conference Board's leading economic index rose modestly in June, signaling sustained positive momentum in the economy following a slowdown at the start of 2014, separate reports showed. The Dow rose 0.7%, the tech-heavy Nasdaq rallied 1.6% and the S&P 500 added a percent.

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Source: Alliance News

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