SALON

Thursday, Aug 16, 2012 5:45 AM UTC

Asia stocks up on hopes China to boost economy

By

Topics: From the Wires,

BANGKOK (AP) — Asian stock markets were mostly higher Thursday after comments from China’s premier added to hopes for more action to spur the world’s No. 2 economy.

Premier Wen Jiabao, during a visit to eastern China earlier this week, was quoted by the official Xinhua News Agency as saying the country has the “conditions and capabilities” to meet its 7.5 percent economic growth target this year.

That raised expectations that the People’s Bank of China would either lower the ratio of funds that banks must hold as reserves, known as the reserve requirement ratio, or lower interest rates. The bank so far this year has lowered both twice in an effort to boost lending and spur growth.

“I think it is unlikely they will cut interest rates because they still want to see prices coming down in the property sector,” said Andrew Sullivan, principal sales trader at Piper Jaffray in Hong Kong. “But like a lot of central banks, they are saying they are prepared to do sometime if it becomes necessary,” he said.

Japan’s Nikkei 225 index rose 1.5 percent to 9,060.59. Hong Kong’s Hang Seng added 0.2 percent to 20,088.98 and Australia’s S&P/ASX 200 added 0.9 percent to 4,318.80. Benchmarks in Singapore, Taiwan and Thailand also rose.

South Korea’s Kospi was 0.1 percent lower at 1,954.08. Benchmarks in mainland China and New Zealand also fell.

Investors also think the European Central Bank will announce new policy measures in the coming weeks. The ECB is expected to restart its bond-buying program in order to hold down borrowing rates of Italy and Spain.

“The lack of negative surprises related to the Euro crisis so far this week has allowed for a mild mood of risk appetite, as hopes for policy action in a few weeks remains high,” analysts at Credit Agricole CIB in Hong Kong wrote in a market commentary.

Among individual stocks, Lenovo Group Ltd. jumped 5.5 percent in Hong Kong after the Beijing-based personal computer maker — the world’s second-largest — reported its latest quarterly profit rose 30 percent.

Hong Kong-listed China Yurun Food Group, a major meat producer, fell 9.9 percent on worse-than-expected results. Japanese electronics maker Panasonic Corp. rose 5.9 percent and Hitachi Ltd. added 4.3 percent.

U.S. stocks closed mostly higher Wednesday after signs that the economic recovery is on track, albeit at a slow pace.

In a sign that of improving manufacturing after a weak spring, the Federal Reserve reported that U.S. industrial production increased last month as factories made more cars, computers and airplanes.

Also, consumer prices were unchanged in July from June, as a small drop in energy costs offset slightly higher food prices. The consumer price index hasn’t changed since March, which means that inflation is in check.

Lower inflation gives the Fed more leeway to launch new programs intended to rekindle the economy. The Fed signaled at a meeting in late July that it is ready to act if growth and hiring stays weak.

The Dow Jones industrial average fell less than 0.1 percent to 13,164.78 on Wednesday. The broader Standard & Poor’s 500 index gained 0.1 percent to 1,405.53, and the Nasdaq composite index lost 0.5 percent to 3,030.93.

Benchmark oil for September delivery was down 7 cents to $94.26 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 90 cents to finish at $94.33 per barrel Wednesday in New York, its highest level since mid-May.

In currencies, the euro fell to $1.2277 from $1.2290 in New York late Wednesday. The dollar rose to 79.30 from 78.88 yen.

More By Pamela Sampson.

Next Article

Related Stories

More Related Stories

Featured Slide Shows

The week in 10 pics

close X
  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11
  • Lisa Montgomery embraces her nephew Thursday after a tornado tore apart her home in Cleburne, Texas. The twister killed six people and destroyed entire swaths of the North Texas town.
    Credit: AP/LM Otero

  • Jack McMahon, the defense attorney for abortion doctor Kermit Gosnell, speaks outside the Criminal Justice Center in Philadelphia Tuesday. His client was convicted of killing three babies in his clinic, and will serve multiple life sentences.
    Credit: AP/Matt Rourke

  • A photo taken Monday captures Vice President Joe Biden's response to a Milwaukee second-grader's innovative proposal to end America's epidemic of gun violence. This guy!
    Credit: AP/Jenny Aicher

  • Sen. Rand Paul, R-Ky., flanked by a grouper-eyed Michele Bachmann, addresses the IRS' admission that it targeted Tea Party groups in advance of the 2012 election. In an op-ed for CNN Thursday, the Kentucky senator slammed the president for his faux outrage.
    Credit: AP/Molly Riley

  • Ousted IRS chief Steven Miller is sworn in on Capitol Hill Friday. Miller testified before the House Ways and Means Committee on the extra scrutiny the agency gave conservative groups applying for tax-exempt status.
    Credit: AP/J. Scott Applewhite

  • Attorney General Eric Holder pauses as he testifies on Capitol Hill before the House Judiciary Committee Wednesday. Holder is under fire, among other things, for the Justice Department's gathering of phone records at the Associated Press.
    Credit: AP/Carolyn Kaster

  • O.J. Simpson sits during an evidentiary hearing at Clark County District Court in Las Vegas, Nev., Thursday. Simpson, who is currently serving a nine-to-33-year sentence in state prison for armed robbery and kidnapping, is using a writ of habeas corpus to seek a new trial.
    Credit: AP/Las Vegas Review-Journal/Jeff Scheid

  • Major Tom to ground control: On Sunday astronaut Chris Hadfield recorded the first music video from space, a cover of David Bowie's "Space Oddity."
    Credit: AP/NASA/Chris Hadfield

  • When it rains it pours. President Barack Obama speaks during a news conference Thursday with Turkish Prime Minister Recep Tayyip Erdogan, inexplicably inspiring an #umbrellagate Twitter meme.
    Credit: AP/Jacquelyn Martin

  • A smoke plume rises high above a road block at the intersection of County A and Ross Road east of Solon Springs, Wis., Tuesday. No injuries were reported, but the the wildfire caused evacuations across northwestern Wisconsin.
    Credit: AP/The Duluth News-Tribune/Clint Austin

  • Recent Slide Shows

  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11

Related Videos

Comments

 0 Comments

Comment Preview

Your name will appear as username

You may use these HTML tags and attributes: <a href=""> <b> <em> <strong> <i> <blockquote>

follow salon

Most Read

Popular on Reddit

links from salon.com

vote
FBI reportedly joins Bachmann campaign finance probe
240 points241 points | 15 comments
vote
Paul Krugman’s right: Austerity kills. "In an economy where we’re all in the same boat, one person’s spending is another person’s income. So when the government cuts spending, it reduces people’s income, leading to less business, more unemployment, and a vicious spiral of slowing down the economy."
251 points252 points | 224 comments
vote
Jon Karl makes things worse: He regrets “inaccurate” Benghazi email but says his story based on it “still entirely stands.” Really. ABC News?
202 points203 points | 31 comments
vote
“Jodorowsky’s Dune”: The sci-fi classic that never was.
78 points79 points | 16 comments
vote
Austerity Kills: Brian McArdle, a 57-year-old man who had had two strokes and could barely walk, was found "fit for work" by a government subcontractor, and had his benefits stopped. He died the next day.
67 points68 points | 5 comments

From Around the Web

Presented by Scribol
listener_new_rect The Listener: So long, Sookie Stackhouse

Recommendations