ZW: Asian Shrs End Mixed:Nikkei Hits Fresh '09 Closing High
By Colin Ng, Philip Vahn and V. Phani Kumar
SINGAPORE (Dow Jones)--Japanese shares ended Friday at their highest level this year, paced by commodity trading houses such as Marubeni Corp. on a broker upgrade and upbeat commodity prices.
Most major indexes in the region also edged higher, clinching gains for the week as well, though Chinese stocks tumbled, with banks led down by China Merchants Bank on the lender's plan to raise up to 18 billion yuan (US$2.63 billion) via a rights share issue.
Japan's Nikkei Stock Average of 225 companies ended up 0.8% at 10597.33, a closing level it hasn't seen since early October, while the broader Topix Index gained 0.5% to 973.57.
"Buying by foreigners continues to lend support, but concerns over U.S. consumption are weighing" on the market, said Tachibana Securities analyst Kenichi Hirano. He said that while production was recovering at most manufacturers, the improvement was mainly a response to drastic cuts in inventories, and "unless consumption picks up, the prospects for an economic recovery remain uncertain."
Australia's S&P/ASX 200 ended 0.6% higher, as comments from Australia's central bank governor reinforced expectations for an economic recovery and helped the Australian and New Zealand stock markets. New Zealand's NZX 50 rose 0.7%.
South Korea's Kospi Composite up 1.7%, and Taiwan's Taiex gained 0.5%. India's Sensex closed down 0.7%, while Singapore's Straits Times Index advanced 0.7%.
China's Shanghai Composite fell 3% to 3046.97, also taking losses during a week marked by investor concerns that monetary policy fine-tuning could hurt market liquidity.
Bank shares were mostly down, with China Merchants Bank ending 2.4% down on its rights share plan. Other banks also declined, with Bank of China down 3%, while Industrial & Commercial Bank of China lost 3.2%.
Analysts, however, remained positive about the country's growth prospects, with Morgan Stanley raising its economic growth forecast for China to 9% for 2009 and 10% for 2010. "The next six to 12 months will likely feature a mix of growth acceleration and low inflation against the backdrop of a relatively stable policy stance," the brokerage wrote in a report.
The weak performance in Shanghai also weighed on China-related shares traded in Hong Kong, and capped the Hang Seng Index's gains for the day at 0.2% after a volatile session.
Shares of Yanzhou Coal Mining's rose 2.3% in strong volume as trade resumed for the first time since Monday, after the company confirmed that it had made a A$3.54 billion ($2.98 billion) bid for Australia's Felix Resources. In Sydney, Felix jumped gained 4.1%.
Alibaba.com shares lost 3.2% after the online business-to-business platform provider posted a 34% on-year decline in its second quarter net profit.
Dow Jones Industrial Average futures were recently up 8 points in screen trade.
In Tokyo, shares of Marubeni jumped 5.8% after Goldman Sachs upgraded the stock to buy from neutral, with other commodity trading houses also up as the brokerage raised its coverage view on the sector to attractive. Mitsubishi Corp. gained 3.3% and Mitsui & Co. added 2.8%.
Higher commodity prices recently also supported gains for some resource stocks, with Nippon Light Metal rising 1.9% and Inpex Corp. 1.8% higher in Tokyo, while Posco gained 2.2% in Seoul and Rio Tinto finished up 2% in Sydney. In Mumbai trading, Oil & Natural Gas Corp. jumped 4.9%, while Hindalco Industries rose 1.3%.
Construction plays rose in Taipei as the government planned a special budget to deal with the aftermath of Typhoon Morakot. Shining Building Business gained 1.1% and Taiwan Cement advanced 3.2%.
New Zealand stocks were helped by continued expectations for a recovery in the global economy. Nigel Scott, an adviser at ABN Amro Craigs, said "the data that we've seen in recent weeks have stopped getting worse. And the results season here has gone all right so far."
Auckland International Airport was up 1.7% and Fisher & Paykel Appliances rose 1.2%.
Thailand's SET Index recently slipped 0.1%, Philippine shares fell 0.2% and Indonesian shares lost 0.6%.
In currency markets, the major exchange rates were in tight ranges, although the Australian dollar pushed higher on comments from Reserve Bank of Australia governor Glenn Stevens. The U.S. dollar was recently at Y95.12, from Y95.36 in late New York Thursday. The euro was at $1.4283 from $1.4282, and Y135.87 from Y136.35.
The Australian dollar was at $0.8425, from around US$0.8410 earlier. Stevens said he didn't want to endorse what level "normal" monetary policy represented, but it was much higher than the present emergency setting of 3.00%.
Stevens didn't seem to be discouraging markets from pricing in higher cash rates, said TD Securities Senior Strategist Annette Beacher. "Clearly the next move is up, and the governor suggested that even if gross domestic product falters, the 'emergency' rate is increasingly no longer required," she said. "While coy about timing, there is no doubt that at this point in time the governor is looking to withdraw the extraordinary stimulus in the economy."
Japanese government bond futures were lifted by gains in U.S. Treasurys Thursday, with the lead September contract ending up 0.45 at 137.98 points.
Spot gold was higher in thin trade, at $955.60 per troy ounce, up 70 cents from New York levels. The lead September Nymex oil futures contract was up 39 cents at $70.91 per barrel on Globex.
