Philippine Daily Inquirer
2:08 am | Friday, October 26th, 2012
HONG KONG—Asian markets were mostly higher Thursday after the US Federal Reserve said it would keep its loose monetary policy in place until there is stronger evidence America’s economy is back on its feet.
Hong Kong posted its 10th straight advance owing to increased market liquidity following the Fed’s monetary easing moves last month.
The euro also rose despite another round of downbeat data from debt-hit Europe, including economic pillar Germany.
Tokyo gained 1.13 percent, or 110.90 points, to 9,055.20 thanks to a weak yen which makes exports more competitive and hopes for fresh monetary easing by Japan’s central bank.
Seoul rose 0.55 percent, or 10.54 points, to 1,924.50 and Sydney closed 0.10 percent, or 4.7 points, higher at 4,510.5.
Hong Kong added 0.21 percent, or 46.45 points, to 21,810.23 as huge amounts of foreign cash flood into the market.
But Shanghai eased 0.68 percent, or 14.41 points, to 2,101.58.
The Fed said Wednesday it would stick to its $40 billion a month bond-buying program – known as quantitative easing – for as long as needed and keep interest rates at record lows until at least 2015.
Despite recent figures pointing to an improvement in the economy – including in household spending and in the housing market – the Federal Open Market Committee said growth remained at a “moderate” pace.
It pointed to a slowdown in business investment and a high unemployment rate, adding there was still vulnerability to strains in the global economy.
“The decision to reaffirm their quantitative easing stance and maintain the guidance on short-term rates reflects a sober view of the domestic recovery,” said Steven Ricchiuto, chief economist at Mizuho Securities USA, in a note to clients.
“Global financial market risk and a depressed labor market were explicitly used to justify policy,” he added, according to Dow Jones Newswires.
Wall Street ended in the red as corporate earnings continued to weigh. The Dow fell 0.19 percent, the S&P 500 shed 0.31 percent and the Nasdaq lost 0.29 percent.
In Europe, data showed German business confidence fell in October for the sixth month in a row to the lowest level since February 2010.
The Ifo economic institute’s closely watched business climate index dropped to 100.0 points in October from 101.4 points in September. Analysts had expected a slight rise.
Adding to the bleak picture, research firm Markit’s Composite Purchasing Managers’ Index, a survey of 5,000 eurozone businesses, fell to a 40-month low of 45.8 in October from 46.1 in September. Anything below 50 is considered a contraction.
The figures put pressure on the euro on Wednesday, sending it to $1.2921 in New York, before it recovered slightly.
In European trade the single currency bought $1.2997 and 104.12 yen, compared with $1.2972 and 103.49 yen in New York late Wednesday.
The dollar was at 80.12 yen against 79.79 yen.
The yen has come under pressure as dealers increasingly expect the Bank of Japan to announce a fresh round of monetary easing – following another batch of weak indicators – when it ends a two-day policy meeting next week.
There is some hope for Greece after the finance minister said he had agreed a new austerity package with international creditors and won more time to fix the debt-crippled nation’s finances.
The European Union and International Monetary Fund said no firm deal had been done but progress had been made.
On oil markets New York’s main contract, light sweet crude for delivery in December was up 52 cents to $86.25 a barrel while Brent North Sea crude for December advanced 81 cents to $108.66.
Gold was at $1,715.50 at 1125 GMT compared with $1,708.50 late Wednesday.
In other markets:
– Taipei fell 0.72 percent, or 52.80 points, to 7,262.08.
Taiwan Semiconductor Manufacturing Co. was 0.70 percent lower at Tw$84.8 while leading smartphone maker HTC dived 5.88 percent to Tw$248.0.
– Manila rose 0.12 percent, or 6.47 points, to 5,405.16.
Metropolitan Bank and Trust led gainers, rising 1.90 percent to 93.75 pesos, while SM Prime Holdings edged down 0.14 percent to 14.24 pesos.
– Wellington fell 0.27 percent, or 10.96 points, to 3,990.49.
Fletcher Building eased 1.9 percent to NZ$7.21, Telecom lost 0.4 percent to NZ$2.47 and Contact Energy shed 0.4 percent to NZ$5.49.
– Kuala Lumpur rose 3.90 points, or 0.23 percent, to close at 1,671.89.
IHH Healthcare gained 0.6 percent to 3.30 ringgit, while Tenaga Nasional added 0.3 percent to 6.95. UEM Land Holdings lost 0.9 percent to 2.13 ringgit.
– Singapore closed 0.42 percent, or 12.78 points, higher at 3,057.51.
Property developer CapitaLand climbed 1.52 percent to Sg$3.30 and banking giant UOB advanced 0.99 percent to Sg$18.58.
– Jakarta closed flat, edging up 3.78 points to 4,339.15.
Retailer Hero Supermarket was down 3.55 percent at 3,400 rupiah, while palm oil company Sinar Mas Agro Resources and Technology rose 2.94 percent to 7,000 rupiah.
– Bangkok gained 0.18 percent, or 2.39 points, to 1,297.39.
Coal producer Banpu edged up 1.29 percent to 393 baht, while PTT lost 0.32 percent to 313 baht.
– Mumbai rose 0.26 percent, or 48.61 points, to 18,758.63.
Auto and farm equipment maker Mahindra and Mahindra rose 3.59 percent to 857.55 rupees while private housing finance firm HDFC rose 2.06 percent to 766.05.
Kingfisher Airlines rose 4.81 percent to 10.9 rupees.
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