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Asia caps week of gains
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August 20, 1999: 5:51 a.m. ET
Overseas funds pour back to Asia while Japanese bank deal inspires Tokyo
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LONDON (CNNfn) - Asian major markets topped off a week-long advance Friday as a surge of fresh buying by overseas investors and Japan's giant banking merger lifted sentiment in the region.
The three-way merger plan between three of Japan's largest banks sent financial stocks in Tokyo soaring and lifted the benchmark Nikkei 225 by 218 points or 1.22 percent to 18,098.11. For the week, the Nikkei was up 3.8 percent.
In Hong Kong, the Hang Seng index lost a little ground in afternoon trading but still closed up 163 points or 1.22 percent at 13,566.74. Following its 3 percent surge Thursday, the index put on 7.6 percent for the week.
Upbeat corporate results, particularly from China-based H-shares, have boosted market confidence and attracted fresh funds from outside the region.
The Straits Times Index in Singapore moved higher on the back of a strong performance from tech stocks, closing up 15 points or 0.77 percent at 2,085.88 and ending the week ahead 5.9 percent.
The Kospi in Seoul advanced 7.2 points or 0.83 percent to close the week at 878.39. However, the uncertainty created by the restructuring of the Daewoo conglomerate unnerved the market during the week, leaving the index down 4.3 percent from last Friday's close.
However, confirmation of a three-way merger plan between Industrial Bank of Japan, Fuji Bank and Dai-Ichi Kangyo Bank dominated trading in Tokyo as financial stocks soared on the prospect of more consolidation in the sector. The merger would create by far the world's largest bank with assets of more than $1.2 trillion.
The buying sent the Nikkei through the 18,000 level in the morning session and the momentum was maintained throughout the session. With shares in the three merger partners suspended, other financial stocks filled the first 20 places in the gainers column.
Tokyo-Mitsubishi, which is set to lose its place as Japan's largest bank if the merger is completed, advanced 10.6 percent. The trust banks were the largest gainers, with Mitsubishi Trust & Banking up 18.3 percent and Sumitomo Trust up 15.1 percent.
Among the city banks, Tokai Bank added 16.4 percent, Sakura Bank gained 16.2 percent and Sanwa Bank advanced 15.6 percent.
Even tech stocks advanced after recent declines in the wake of the Nasdaq's decline. Sony Corp. closed up 2 percent.
Hong Kong's advance was driven by the sheer weight of funds flowing into the region, with only renewed hopes of China's entry to the World Trade Organization providing local impetus.
The afternoon dip took the shine off some of the early advances, but financial stocks maintained their momentum. HSBC Holdings and Hang Seng Bank both rose 0.5 percent.
Citic Pacific put on 3.4 percent and China Telecom added 2 percent as H-shares performed well. Hutchison gained 3.4 percent.
Smaller markets also closed ahead.
Thailand's SET index led the advance as it jumped almost 6 percent to close at 442.93, a gain of 4.8 percent for the week.
The TAIEX in Taipei added 1.9 percent to 8,117.42. up 6.4 percent from last Friday's close.
The PHS in Manila was up 2.3 percent at 2,209.47, 1.7 percent ahead on the week. The JSX in Jakarta bucked the trend with a 1.3 percent decline at 574.26, but was still 3 percent ahead for the week.
The Kuala Lumpur Composite recovered early losses to close up 0.5 percent at 762.47, down 1.3 percent from last Friday's close
The All Ordinaries in Sydney suffered U.S. interest rate jitters and closed down 0.11 percent at 3,023.8, although it still posted a 2.2 percent gain for the week. 
-- from staff and wire reports
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