|
Tokyo hits 20-month high
|
 |
June 17, 1999: 5:26 a.m. ET
Nikkei jumps 260 points, other Asian markets boosted by benign U.S. inflation
|
LONDON (CNNfn) - Benign U.S. inflation buoyed Asian markets Thursday after prompting an overnight surge on Wall Street, as fears of higher U.S. interest rates eased somewhat. Japanese blue chips closed at their highest level since October 1997.
The Nikkei 225 closed 1.51 percent higher, a gain of 260.27 points to close at 17,470.45, as overseas funds flooded into Japan. Investors were given added incentive to go Japanese after Merrill Lynch said it was increasing its exposure to the country. But the index finished well short of a new record intra-day high of 17,547.29.
The news from the U.S. that inflation at the consumer level appeared under control eased concerns that the U.S. Federal Reserve may hike interest rates more than. Markets are now banking on just the one rate rise once at the end of the month. Asian investors were keeping one eye on testimony from the head of the U.S. Federal Reserve Alan Greenspan later Thursday
The U.S. consumer price index remained unchanged overall in May, and rose only 0.1 percent excluding volatile food and energy prices. The data quieted speculation that a Federal Reserve interest rate hike was imminent. Wall Street had steeled itself to see the headline figure increase 0.2 percent.
The U.S. markets rallied in response. The Dow Jones industrial average gained 189.96 points, or 1.8 percent, to close at 10,784.95. The surge on the Nasdaq was even more impressive after recent weak sessions, with the tech-laden index soaring 103.16 points, or 4.3 percent, to end at 2,517.83 - its largest one-day point advance in history.
Japanese technology stocks jumped on the back of Nasdaq's surge, with two of the biggest climbers benefiting from some extra corporate news. Computer maker Fujitsu jumped 5.05 percent to 2,290 yen in anticipation of a widely-leaked link-up with German giant Siemens (FSIE) to create what would be Europe's second largest PC maker.
Internet specialist Softbank closed 5.16 percent higher at 19,140 yen, buoyed by confirmation that it had sealed a deal with Nasdaq's parent company to create a mirror image of the tech index in Tokyo.
The auto sector enjoyed some particularly strong buying on the back of Merrill's bullish sentiment towards Japanese equities. Suzuki Motors put in a stunning performance, to close up 9.75 percent at 1,970 yen. Mazda roared ahead 5.56 percent to end at 665 yen and Mitsubishi Motor jumped just over 5 percent to close at 626 yen.
In Hong Kong, the Hang Seng index mimicked Tokyo in paring some of its earlier gains to close 253.15 points higher, a gain of 1.92 percent to 13,408.27.
Index heavyweight HSBC led the way and closed 2.1 percent higher at HK$291.
But a rally of South Korean blue chips ran out of steam amid continued tension in the Yellow Sea, following a naval clash Tuesday between South and North Korea. The Kospi index ended just 0.33 percent higher at 832.26.
Elsewhere, earlier gains on Singapore's Straits Times index were almost consumed in a bout of selling in late trade, with blue chips up just 0.4 percent at 2,051.90.
Sydney's All Ordinaries ended the session up 1.29 percent at 2,980.3, a gain of 38 points, led by strong buying of interest-rate sensitive financials.
In Taiwan, the Weighted index jumped over 215 points to end at 8,274.36, a rise of 2.67 percent, while Philippine blue chips gained 1.12 percent to end at 2,418.08.
Bangkok's Set index was up 1.5 percent at 517.67 in late trade, while Jakarta's blue chip rallied ahead of a visit by officials from the International Monetary Fund. The JSX index was over 3 percent higher at 681.97.
Kuala Lumpur was the only Asian market to buck the trend with the Composite index down around 0.3 percent at 789.31. Investors were unsettled ahead of an expected announcement Friday of national elections.
-- from staff and wire reports
|
|
|
|
|
 |
|
