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Asia piggy-backs on Dow
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October 25, 1999: 6:42 a.m. ET
Wall St. rally feeds healthy gains in Tokyo, HK; Daewoo woes hit Korea
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LONDON (CNNfn) - Asia's leading markets forged more than 1 percent higher Monday, encouraged by a triple-digit rally on Wall Street Friday that helped ease fears of a sharp correction in U.S. stock prices. Tokyo gained 1.2 percent and Hong Kong marched up 1.3 percent as a handful of blue chips lured throngs of buyers to the market
Japan's benchmark Nikkei 225 average ended up 209.99 points, or 1.2 percent, at 17,648.79. The Key Dow Jones industrial average rallied 172.56 percent, or 1.7 percent Friday as Congress and the White House drew closer to agreeing upon the fine points of crucial bank-reform legislation. The Dow gained 450 points last week
The tech-heavy Nasdaq Composite and the S&P 500 also posted modest gains. For the week, the indexes were up 3.1 percent, and 4.4 percent, respectively.
Hong Kong's Hang Seng advanced 171.10 points, or 1.33 percent, to finish at 13,034.18 amid brisk buying in the run-up to the government's launch Friday of a HK$10 billion ($1.287 billion) public offering. Advancers outstripped decliners 313 to 251. The public offering of an index trust, known as the Tracker Fund, is part of the government's effort to pare an equity portfolio amassed during a controversial market intervention last year, when Hong Kong was convulsed by financial turmoil.
Local traders cautioned that traders in Hong Kong were keeping a close eye on the interest-rate outlook in the United States.
A large share of Monday's rise came from gains in CITIC Pacific and Hang Seng Bank. CITIC Pacific gained 5 percent, while Hang Seng Bank rose 2.6 percent. However, traders warned the companies are expected to trim 70 points from the index after they go ex-dividend next week.
In Tokyo, a string of regional banks performed especially well Monday, lifted by continued speculation of further tie-ups in the financial sector. The market is also looking forward to the creation of eight new investment trust funds towards the end of next week, traders told Reuters. The launch of the new trusts would inject extra liquidity into the Nikkei.
The Bank of Yokohama climbed 12 percent to 662 yen; Joyo Bank vaulted 18.78 percent to 506 yen and Chiba Bank added 6.17 percent to 551 yen.
Nippon Telegraph and Telephone Corp. shot up 3.4 percent, with two subsidiaries - NTT Mobile Communications Network (DoCoMo) and NTT Data Corp. - both parading up more than 5.5 percent after announcing plans to apply for a license to provide data broadcasting services.
In Hong Kong, Hutchison Whampoa lost 2.2 percent, hit by selling pressure following solid gains last week after the company said it expected to reap a HK$113 billion ($14.54 billion) windfall from the $36 billion sale of U.K. mobile phone arm Orange (ORA) to Germany's Mannesmann (FMMN).
By contrast, the leading gainer, Sun Hung Kai Properties, soared 6.2 percent to HK$59.750, after Sun Hung Kai and software giant Microsoft (MSFT) unveiled plans to form a strategic partnership aimed at harnessing the potential of Hong Kong as a regional technology hub.
Among other regional markets getting a boost from the Wall Street gains were Singapore, Australia, Taiwan, Thailand and Malaysia.
Singapore's Straits Times index closed up a quarter of a percent at 2,022.36, though volume was fairly light. Blue-chip banks such as DBS Group and United Overseas Bank were firmer.
In Australia, the All Ordinaries gained just over half a percent to close at 2,855.4, helped by firm bank stocks, though gold stocks dipped around 2 percent as the precious metal slipped towards the $300-per-ounce level and resource shares were also weak. News Corp. rallied strongly following strong previous gains by its American Depositary receipts in New York.
Bucking the regional upswing, South Korean stocks closed 2.5 percent lower as investors fretted over the debt-saddled Daewoo Group.
Jakarta shares slid 1.2 percent amid concerns about the final shape of the cabinet to be selected this week by newly-elected President Abdurrahman Wahid. Malaysia climbed 1.4 percent, while Manila shares slid 1.4 percent to an eight-month low amid worries over poor third-quarter corporate earnings and rising domestic interest rates.
In Taiwan, the Weighted Index jumped 1.6 percent to close at 7,680.87 amid lessening fears over the market downside for Taiwan's latest earthquake on Friday. Thai stocks leapt 2.7 percent, spurred by the Wall Street gains.
--from staff and wire reports
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