Accessibility links

Breaking News
News

Major Asian Markets Enjoy Boost from Positive US Economic News - 2003-10-10


Shares in Asia were lifted this week on the back of positive U.S. economic data.

Hong Kong's Hang Seng index surged to a 16-month high in morning trading Friday, but the market's rally stopped short of taking the index past the 12,000 point mark. By Friday afternoon, the Hang Seng gained 2.5 percent on the week.

Andy Xie, an economist with Morgan Stanley investment bank in Hong Kong says good economic news from the United States hints at more spending by American consumers, which means demand for Asian exports will increase.

"Basically the U.S. labor market is improving. That is giving investors confidence that the global economy is on an upward trend," he said. "We see money coming to this region so that's why markets are still doing very well."

The positive economic data and a slight weakening of the yen led the Nikkei 225 to hit 10,786 on Friday - a 300 point rise. The increase made up for earlier loses, however, the Nikkei closed less than one point higher this week.

In the past few weeks, the yen has strengthened against the dollar. This has hurt shares of Japanese exporting companies because it makes Japanese exports more expensive in foreign markets.

"Everything else being equal, when the yen goes up the Japanese stock market will go down," explained Mr. Xie, of Morgan Stanley. "But when there is good news for the U.S. economy it's a balance the market goes up."

Japanese Finance Minister Sadakazu Tanigaki told reporters on Friday that the yen's rise has been too sudden.

He said Japan will take appropriate action to stem the yen's surge. The comment implies that Tokyo may intervene to weaken its currency. But traders say his comments will have little influence on strong yen-buying sentiment.

Manila's main share index ended three percent higher than a week ago Friday, at 1,345.

Korea's Kospi index, which was lagging behind gains made in other east Asian benchmarks in past weeks, closed almost six percent higher on the week at 757.

XS
SM
MD
LG