Asian markets rise on US, China manufacturing

Hong Kong, May 2, 2012 (AFP)
Asian stock markets climbed on Wednesday after strong manufacturing data from the United States and China boosted optimism over the state of the world’s two biggest economies.

The dollar rebounded after hitting a two-month low against the yen while the Dow rallied to its best close for more than four years.

Hong Kong was 0.90 percent higher, Shanghai gained 0.88 percent and Seoul added 0.67 percent.

Tokyo was virtually unchanged by the break while Sydney was also flat.

The mood was upbeat on the back of Wall Street’s strong lead after the US Institute for Supply Management said its manufacturing index rose for the second straight month in April, to 54.8 percent, from 53.4 in March. Analysts had forecast the reading would fall to 53.0.

Any reading above 50 is considered growth while a reading below indicates contraction.

“The better-than-expected manufacturing figures come after a series of disappointing data and the surprise among investors is evident across commodities and risk assets,” said Justin Harper, Singapore-based strategist at IG Markets, in a note.

The Dow Jones Industrial Average jumped 0.50 percent to close at its highest since late 2007, while the S&P 500 gained 0.57 percent to 1,405.88 and the tech-heavy Nasdaq climbed 0.13 percent.

The news from Washington followed official figures from China showing manufacturing activity rose in April to a 13-month high, lifting hopes the Asian giant’s economy may have bottomed out in the second quarter.

The official purchasing managers index (PMI) rose to 53.3 from 53.1 in March, its fifth consecutive month of expansion, the China Federation of Logistics and Purchasing said.

Banking giant HSBC is to release its own closely watched PMI later on Wednesday.

The two sets of numbers provided some relief to investors after a string of weak figures from Beijing and Washington in recent months.

Eyes will now be on the United States for the latest batch of employment data later due out this week, with traders looking for clues on the state of the economy.

On foreign exchange markets the dollar edged up against the yen after slipping to 79.73 yen in Asia Tuesday — its lowest level in more than two months.

It was changing hands at 80.20 yen in early Tokyo trade Wednesday, compared with 80.13 yen late Tuesday in New York.

The euro bought $1.3222 and 105.98 yen against $1.3234 and 106.05 yen in New York.

Oil slipped, with New York’s main contract, West Texas Intermediate crude for delivery in June, down 36 cents at $105.80 per barrel while Brent North Sea crude for June shed 12 cents to $119.54.

Gold was at $1,659.60 an ounce at 0300 GMT.

— Dow Jones Newswires contributed to this story —

 

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