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Asia shrugs off rate anxiety
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February 2, 2000: 5:51 a.m. ET
Key Asian bourses end higher, lifted by tech, Internet and media stocks
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LONDON (CNNfn) - Asia's major markets rose in unison Wednesday as traders took an anticipated credit-tightening by the U.S. Federal Reserve in stride. Tokyo shares closed at their highest level in 30 months, led by a strong overnight performance on Wall Street and optimism over the launch of a major new investment trust. Hong Kong ended modestly higher, led by media and Internet-tied stocks, while Australia climbed 1 percent and Singapore leapt almost 2 percent.
Weakness in the Japanese yen, which dipped to a four-and-half-month low, helped bolster Tokyo blue chips, analysts said. By late Wednesday in Tokyo the dollar was quoted at about 108.45 yen, slightly down from earlier levels.
"A lot of people are really focused on the currency," Robert Sasaki, chief quantitative strategist at Jardine Fleming in Tokyo, told CNNfn.com, noting that a weak yen is regarded as a boon for exporters. "Most people are fairly relieved. It has been said that the breakeven for most Japanese exporters is around 110 to 112 yen."
March 10-year Japanese government bond futures fell almost a full point to an intraday low of 132.08, pressured by the Nikkei's gains and the yen's decline against the dollar. On the interest-rate front, traders said they are expecting the U.S. Federal Reserve to decide on a quarter-percentage-point increase later Wednesday and have already priced such a hike into equity prices.
The Nikkei Average of 225 leading shares ended up 155.53 points, or 0.8 percent, at 19,578.91. Blue chips got a lift from Nomura Asset Management's launch of a new investment trust valued at 792.5 billion yen ($7.4 billion), Japan's largest-ever equity fund in terms of initial subscriptions. Nomura's fund is the biggest of several new investment vehicles that have sparked hopes of an injection of extra cash into the stock market.
Many stocks that the new investment portfolios are expected to hold made progress Wednesday. NTT advanced 2.5 percent to 1.63 million yen, while its mobile subsidiary NTT Docomo edged up half a percent to 3.72 million yen.
Consumer electronics giant Sony Corp. rose 1.6 percent to close at 27,550 yen, helped by a 2.8 percent rally Tuesday on the U.S. Nasdaq composite index. The blue-chip Dow Jones industrial average rose 100.52 points to 11,041.05, powering ahead for a second straight session amid impressive gains in high-tech stocks. Despite the Nasdaq strength, Japan's red-hot Internet investment company Softbank Corp. shed 2.8 percent to 103,000 yen.
In Hong Kong, gains among telecom and technology stocks drove the main Hang Seng index, which closed up 135.96 points, or 0.87 percent, at 15,789.82. Earlier in the session, the index tested the 16,000 level, coming within 61.48 points of the psychologically significant mark.
Index heavyweight China Telecom posted strong gains, while investment conglomerate CITIC Pacific bounded up more than 3.7 percent amid rumors of a possible tie-up with U.S.-based Lucent Technologies (LU: Research, Estimates). Media stocks also outperformed, exemplified by a 17.7 percent surge in Television Broadcasts. The stock has risen since the company said in mid-January that it plans to list TVB.com on either the Nasdaq market or an enterprise market in Hong Kong.
Blue-chip conglomerate Hutchison Whampoa, which holds a 10.2 percent stake in German telecom operator Mannesmann, ended almost 1 percent higher following sharp jumps in Europe Tuesday for both Mannesmann and its hostile suitor, Vodafone AirTouch. The U.K. company is seen as increasingly likely to prevail in its bid for Mannesmann. Hutchison parent Cheung Kong rose 3 percent.
In Sydney, the All Ordinaries index staged a relief rally after the Reserve Bank of Australia increased its official cash interest rate by a half point to 5.5 percent, taking many market observers who had expected a smaller increase by surprise. Local traders believe the move will help dispel some of the recent uncertainty about interest-rate prospects, encouraging a move back into equities. The main index ended at 3,116.3, up 1 percent, or 31.8 points, helped by a 7.3 percent increase for Rupert Murdoch's News Corp. to A$20.165, after the stock hit an all-time high of A$20.55 earlier in the session.
The Straits Times Index in Singapore advanced 1.9 percent to close at 2,271.40, buoyed by banking and technology stocks, while retail investors in Kuala Lumpur converged on small-cap issues to drive Malaysia's key index up 2.25 percent to finish at 942.85. The Kospi index in South Korea gained 1.6 percent to 943.59, though upward momentum was restrained by wariness as traders awaited news of the U.S. interest-rate decision.
Manila shares finished with slight gains, while Thai stocks shed 0.8 percent. In Jakarta, the main index dived 2.2 percent amid growing anxiety over a power struggle between the country's president and its army chief. 
--from staff and wire reports
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