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Tokyo leads Asia advance
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November 13, 1998: 4:49 a.m. ET
Threat of military action in Iraq fails to halt rise of region's major markets
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LONDON (CNNfn)- Tokyo, Hong Kong and Singapore stocks all closed higher Friday, but second-tier Asian markets were mixed as worsening tensions in the Gulf worried investors.
The threat of military action cut buying enthusiasm worldwide Thursday with Europe closing mixed and Wall Street rising only slightly.
Neither Hong Kong nor Singapore could match Tokyo's 1.37 percent gain. Taiwan closed about 3 percent up, Malaysia climbed almost 1 percent while Korea and Thailand finished negligibly higher.
But Australia, Indonesia and the Philippines all eased about 1 percent by their closes.
Japan's benchmark Nikkei 225 stock average closed up 193.15 points or 1.37 percent at 14,268.21. Nikkei December futures were 200 points higher at 14,320.
The government is set to meet Monday to finalize a financial stabilization package worth about 18 trillion yen ($146 billion), and analysts are divided on whether the government will temporarily suspend sales tax.
Traders said the market would be disappointed if the government fails to come up with any new measures beyond the tax cuts announced Thursday.
But they reacted positively to suggestions by the Economic Planning Agency that the total package was not finalized. Those hints fueled rumors that the total could rise to 22 trillion yen.
Traders were left scratching their heads to explain the gains in the absence of hard news. "We suspect there might have been some public fund buying," said HSBC Securities economist Peter Morgan.
"There was no news to excite people. It all happened in the afternoon," he said.
Real estate stocks were strongest though many banks and some of the country's giant exporters fared well.
Sumitomo Bank rose 1.34 percent to 1,287 yen and Sanwa Bank leaped 3.24 percent to 1,020 yen.
Honda Motor climbed 2.73 percent to 4,140 and Mazda Motor rose 1.69 percent to 480.
Hong Kong closed at 9,997.99, rising 49.81 points or 0.5 percent. Trading was thin ahead of next week's U.S. Federal reserve meeting and rising tensions in the Gulf, traders said.
Among blue chips, heavyweight HSBC Holdings eased HK$1 to HK$178 but property counters were strong. Sun Hung Kai rose HK$1.75 to HK$52.00.
China-related stocks were also lower as investors appeared to be cashing in recent sharp gains. Red chips lost 0.85 percent to 1,046.48 and H shares lost 1.09 percent to 470.50.
After the market closed the Hong Kong Association of Banks said it would cut interest rates next week if the U.S. Federal Reserve does so first at its meeting next week.
Singapore ended 0.81 percent higher at 1,206.91.
Korea closed 0.19 percent higher while Taiwan closed up 2.63 percent. Late Thursday, the Taiwanese finance ministry unveiled new measures to restore market confidence, including the formation of an emergency stabilization fund of up to T$200 billion ($6 billion). The fund immediately began buying stock.
Australia dipped 1 percent, dragged down by disappointing profit figures from index heavyweight News Corp. (NWS). Its stock dived 4.9 percent to A$10.70.
The Indonesian rupiah fell through 8,000 against the dollar on fears of more clashes in Jakarta and a statement from the armed forces chief telling businesses to close. Jakarta stocks were down 0.68 percent.
The Philippines eased 1.28 percent. In Malaysia, stocks closed 0.94 percent lower. Thai stocks finished up 0.16 percent.
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