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Tokyo boosted by data
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August 10, 1999: 6:01 a.m. ET
Strong machinery orders help Nikkei inch ahead; HK plunges on US rate fears
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LONDON (CNNfn) - Tokyo blue chips were lifted out of the red by stronger-than-expected manufacturing data Tuesday. Most other Asian markets ended in the minus column as investors continued to retreat under the threat of higher U.S. interest rates.
Japan's Nikkei 225 index closed just 12 points higher at 17,202.09. Sentiment was lifted by an unexpected jump in machinery orders in June, with the core private sector orders surging 6.3 percent versus expectations of a 1.5 percent rise.
The announcement by the Economic Planning Agency came only an hour before the close of trading and helped put some direction into an otherwise dull market.
The data, a lead indicator of capital spending, is a good clue toward gross domestic product figures for the April-June quarter, due out in September. "Recovery in capital spending in the private sector has been trailing behind other indicators, such as public works spending and private consumption. But it seems like it has finally bottomed out," Noriko Irie, market economist at Fuji Securities in Tokyo told Reuters.
The main focus in the rest of Asia was another losing session on Wall Street Monday.
The Dow Jones industrial average closed about 6 points lower, while the Nasdaq Composite fell more than 1 percent as worries about higher U.S. interest rates continued to plague the market.
In Hong Kong, the Hang Seng slumped 349 points to end at 12,596.71, a fall of almost 2.7 percent, as traders took their cue from Wall Street and continued to worry about the possible devaluation of the yuan.
"Most of the markets in the region are also under selling pressure on fears of rising (U.S.) interest rates. The funds have definitely been trimming down their [Asian] exposure," Alex Tang, research director at Core Pacific-Yamaichi told Reuters.
Traders said the high yield on U.S. treasuries was pulling money out of the region.
The Straits Times index in Singapore, which was closed Monday for a public holiday, closed down more than 2.2 percent at 2,022.56.
In Sydney, the All Ordinaries ended more than 0.6 percent lower at 2,958.7, as Australian traders reacted to the sell-off in the U.S. bond market.
Korean and Taiwanese markets defied the trend, however. Seoul's Kospi jumped more than 2 percent to close at 968.25, on renewed hopes that the creditors of Daewoo would force the country's second largest conglomerate into a radical restructuring.
In Taiwan, the focus switched from perennial tensions with mainland China to focus on strong economic fundamentals. The Weighted index rallied after recent weak sessions, to close up more than 3.4 percent at 7,269.60.
Kuala Lumpur's blue chips also had a winning session, breaking a four-day run of losses after a technical rebound. The Composite closed 2.3 percent higher at 683.65.
Other markets ended lower. Manila's Composite closed down just over 1 percent at 2,230.78. The JSX index in Indonesia fell 3 percent to 576.34 and Thailand's Set fell 0.6 percent to 430.85.
-- from staff and wire reports
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