Asia Stocks Get Support from China, U.S. Data
Asian stocks jumped higher on Monday after strong economic data from the world’s two largest economies helped sentiment, while a profit warning from QBE Insurance Group in Sydney weighed on Australian stocks.
The U.S. economy added 203,000 jobs in November, according to data released by the Labor Department late on Friday, while unemployment fell to 7%, a five-year low. Both figures beat expectations and were interpreted positively by Wall Street as a sign of strength in the world’s largest economy.
The main data point in Asia came from China over the weekend, as the countryposted its largest trade surplus in nearly five years. Exports rose by a hefty 12.7% from a year earlier, while imports rose 5.3%.
The trade data were a positive sign for both China and the global economy, and it was followed early Monday by inflation data. The country’s consumer-price index rose by 3% from a year earlier in November, in line with expectations for a 3.1% increase.
The data reports helped market sentiment, which could be seen in a weaker yenUSDJPY +0.08% . The dollar pushed 0.5% higher to ¥102.89 against its Japanese counterpart on Friday and edged slightly higher on Monday to trade at ¥103.02.
The dollar trading above the ¥103 mark gave a boost to Japanese stocks, as the Nikkei Average JP:NIK +2.29% jumped 1.9%. The weaker currency helped exporters, as Toyota Motor Corp. JP:7203 +1.29% TM +0.94% rose 1.1%, and Kyocera Corp. JP:6971 +2.52% KYOCF +3.44% added 1.9%. Industrial robotic firm Fanuc Corp. JP:6954 +2.54% FANUF 0.00% rose 2.3% after Credit Suisse raised the firm’s target price.
“The correction stage of the U.S. shares prior to the employment data release is over, and there is a greater optimism in the market buoyed by the reaction to the strong employment figures,” said Mitsushige Akino, fund manager at Ichiyoshi Asset Management.
In China, Hong Kong’s Hang Seng IndexHK:HSI +0.29% rose 0.5%, and the Shanghai Composite CN:SHCOMP +0.05% rose by 0.4%.
Elsewhere in the region, South Korea’s Kospi KR:SEU +1.01% gained 1%, Singapore’s Straits Times IndexSG:STI -0.02% added 0.3%, and the Philippines PSE Composite PH:PSEI -0.10% fell 0.1%.
Australia failed to take part in the regional rally, as the S&P ASX 200AU:XJO -0.80% turned a modest early gain into a loss after the local mood was hurt by a profit warning from QBE Insurance Group AU:QBE -21.82% QBEIF -1.27% . The index traded down 0.6%.
The Sydney-based insurer predicted a sharp swing to a full-year loss due to higher claims provisions in North American, forecasting a $250 million net loss for the year. As a result, the company’s stock plunged 19.7%, accounting for around one half of the fall on the index.
Source: MarketWatch
