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WORLD> Asia-Pacific
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Asian markets rise as Congress nears auto deal
(Agencies)
Updated: 2008-12-10 16:12 SEOUL, South Korea -- Asian markets shrugged off negative economic news to rise Wednesday, underpinned by continued faith in government measures to boost flagging economies as Congress neared a deal to rescue ailing US automakers.
Japan's benchmark Nikkei 225 stock average rose 238.60 points, or 2.8 percent, to 8,634.47 and Hong Kong's Hang Seng index advanced 525.45 points, or 3.6 percent, to 15,278.67. Benchmark indexes in Australia, South Korea, India, Shanghai and Singapore also rose. New Zealand's market ended down. "Certainly, it looks like this is a bear market rally and it could continue for awhile," said Mark Tan of UOB Asset Management in Singapore, referring to recent gains as a temporary respite in an overall market downtrend. Stocks in Tokyo advanced despite data showing that core machinery orders, a key barometer of corporate capital spending, fell 4.4 percent in October, indicating that business investment was retreating sharply amid the global slump. Investors were focusing more on continued economic rescue efforts by governments, including a tentative agreement on a rescue plan for US automakers, said Kazuhiro Takahashi, equity general manager at Daiwa Securities SMBC, in Tokyo. Democratic congressional leaders and White House officials agreed in principle Tuesday on a $15 billion bailout of Detroit's "Big Three" automakers that would give the government extraordinary power to restructure the failing industry. Fears of a possible implosion of the US auto industry have weighed on stock markets in recent weeks as a failure to come up with a support package would strike a further blow to the reeling US labor market. "Investors welcomed the news of congressional agreement to rescue the Big Three automakers, which came after Wall Street closed," said Daiwa SMBC's Takahashi. Honda Motor Co. surged 11.1 percent and Nissan Motor Co. jumped 5.8 percent. Japanese electronics maker Sony Corp. overcame an initial fall to rise 1.3 percent after announcing Tuesday it will cut 8,000 jobs, 4 percent of its worldwide work force, rein in spending and shutter plants as it tries to ride out a looming worldwide recession that is battering Japan's export-reliant manufacturers. On Tuesday, the Dow Jones industrial average fell 242.85, or 2.7 percent, to 8,691.33 after logging a total gain of 560 points Friday and Monday. Wall Street futures pointed to gains in US markets Wednesday with Dow futures up 100 points, or 1.1 percent, at 8,818 and S&P500 futures up 10.8 points, or 1.2 percent, at 900.30. The Australian stock market bounced back from a slow morning, overcoming the negative lead from Wall Street to rise 1 percent in afternoon trading as resources stocks rallied. BHP Billiton, the world's largest mining company, jumped 6.9 percent and rival Rio Tinto soared 10.9 percent. Oil prices rose above $43 a barrel Wednesday in Asia as investors looked to an expected OPEC production cut next week to help stabilize prices that have plummeted amid a global economic slowdown. Light, sweet crude for January delivery was up $1.21 to $43.28 a barrel in electronic trading on the New York Mercantile Exchange by midday in Singapore. The contract fell overnight $1.64 to settle at $42.07. The US dollar stood at 92.45 yen in early afternoon trading in Tokyo, compared with 92.22 yen in New York late Tuesday. |
