WSJ: Asian Shares End Higher; Banks Advance In Tokyo
SINGAPORE (Dow Jones)--Asian stock markets rose Friday after sharp gains on Wall Street Thursday, with Japanese banks getting an additional thrust following the resignation of financial services minister Shizuka Kamei.
Japan's Nikkei Stock Average finished 1.7% higher, the Shanghai Composite Index ended up 0.3%, and Australia's S&P/ASX 200 climbed 1.6%. South Korea's Kospi rose 1.4%, while Hong Kong's Hang Seng index added 1.2% and Taiwanese shares advanced 1.6%.
India's Sensex rose 0.8% and Singapore's Straits Times Index advanced 0.4% in afternoon trading. Dow Jones Industrial Average futures slipped five points in screen trade, after the DJIA jumped 273 points Thursday.
Shares in Japan were higher with banks climbing on news Shizuka Kamei, chief of the People's New Party, is quitting the Cabinet to protest the Democratic Party of Japan's decision to postpone postal overhaul bills until the next Diet session.
"Many foreign investors had seen Kamei's influence upon the Cabinet as a reason to despair over Japanese government accountability and better corporate governance. The U.S. and Europe saw Kamei's reform bill as a move away from a 'level playing field' in the financial, postal and insurance businesses," said Naomi Fink, strategist at Bank of Tokyo-Mitsubishi UFJ.
Mitsubishi UFJ Financial Group climbed 3.1% and Sumitomo Mitsui Financial Group added 1.4% and Shinsei Bank rose 3.3% as the reform of the postal system would have meant greater competition for banks and as Kamei was known to be keen on stricter regulation of consumer finance companies.
The yen's recent weakness also helped lift exporters, with Sony expanding 1.9%, Sharp climbing 3.9% and Canon rising 1.9%.
Chinese shares advanced but underperformed the region as a slew of economic data painted a mixed picture of Asia's second biggest economy. Official numbers showed China's inflation accelerated while industrial output moderated, posing a challenge for the People's Bank of China on future policy.
China's consumer price index rose 3.1% on-year in May, exceeding Beijing's 3% annual target and accelerating from April's 2.8% increase.
"The stock market will continue to consolidate, because of the uncertainty surrounding China's macroeconomic policies," said Capital Securities analyst Jacky Zhang in Shanghai. "The uncertainty will hurt demand for banking, property and steel stocks which are more vulnerable to policy changes than other sectors," he added.
Commodity producers, which benefit from inflation, broadly advanced, with Baoshan Iron & Steel Co. rising 1.2% and Jiangxi Copper climbed 2.1%.
Traders said some investors were locking in profits ahead of the extended holiday weekend as China's markets will be closed from Monday to Wednesday for the Dragon Boat Festival.
Resource stocks were higher in Sydney after Prime Minister Kevin Rudd said in an interview with Channel Seven that talks with miners probably will yield a deal on the controversial 40% super profit tax on mining companies, but he dismissed a report that such a deal would be announced within days, saying talks would take "weeks and probably months." Australia's Herald Sun Friday reported that the Rudd government would announce major changes to the planned tax later in the day or on Saturday.
Rio Tinto rose 1.8%, BHP Billiton climbed 2.6% and Fortescue Metals Group added 3.8%, while Newcrest Mining added 1.5%.
Indian shares advanced, helped by economic data showing the country's industrial production surged in April from the year-earlier period, trouncing estimates. Market heavyweight Reliance Industries climbed 2.8%, while Housing Development Finance Corp. rose 2.0% in afternoon trading.
Standard Chartered's Indian depository receipts were toeing the flat line on their debut, trading at INR103.75 in the afternoon, from their listing price of INR104.00. The bank became the first company to list depository receipts in India.
In Hong Kong, shares of fashion retailer Esprit Holdings, which generates a large chunk of its cash in Europe, rose 1.6% as concerns over European economies eased. Oil explorer Cnooc was up 2.4% as crude-oil prices stayed above $75 a barrel level on Globex.
Among other Asian markets, New Zealand's NZX 50 added 1.3% and Philippine stocks finished 1.3% higher. Indonesian shares added 1.4% and Thailand's SET Index gained 0.2% in late trading.
In foreign-exchange markets, the euro was slightly lower after rebounding sharply on Thursday due to a rise in risk appetite and signs of stability in the euro-zone. The single currency was buying $1.2121 from $1.2138 late Thursday in New York, and Y110.73 from Y110.84. The dollar was fetching Y91.54 from Y91.30.
"Most of the data released in the past 24 hours has been on the firmer side of expectations. We suspect the [U.S. dollar] is susceptible to further downside should tonight's data continue to restore faith in the global economic recovery," said Mike Jones, currency strategist at the Bank of New Zealand.
Japanese government bonds were lower, tracking the fall in U.S. Treasurys Thursday and the Nikkei's rise. Lead September JGB futures were off 0.27 at 140.34 points, while the 10-year cash JGB yield was up three basis points at 1.230%.
Spot gold was at $1,218.60 per troy ounce, up 90 cents from the New York close Thursday. Nymex July crude-oil futures were down 37 cents at $75.11 per barrel on Globex.
-Dow Jones Newswires; +65-6415-4140; markettalk@dowjones.com
