Asian Stocks Open Higher as SARS Spread Seems to Slow
Mon Apr 28,11:56 PM ET
Share prices were mostly higher across the Asian-Pacific region early Tuesday, helped by optimism among investors that the severe acute respiratory syndrome, or SARS (news - web sites), epidemic appears to be coming under control in several affected areas. Many airline stocks benefited.
Hong Kong's Hang Seng Index climbed 2% to 8604.26, and investors predicted a SARS relief rally in coming days. Airline stocks especially got a much-needed lift on news SARS cases were down below 20 for three straight days. Cathay Pacific advanced 6.9% to 9.30 Hong Kong dollars.
Hopes that the SARS contagion was under some measure of control boosted stocks in Singapore, where the Straits Times Index climbed 2.5% in morning trade. Trading volume was robust, and advancing issues outnumbered decliners by a wide berth.
Shares in Malaysia were lifted by gains on Wall Street overnight and news the SARS spread may finally be contained. Travel-related stocks climbed as worries about SARS receded. Genting advanced 1.7%, while Resorts World gained 2.6% and Malaysian Airline System moved ahead 0.6%.
On Wall Street, the Dow Jones Industrial Average advanced 165.26 points, or 1.99%, to 8471.61.
However, in China, the Shanghai Composite eased 0.7%, amid "great uncertainty" about the impact of the market's expected special closing over SARS, said analysts. Views are varied over the wisdom of closing markets, with the big question being whether SARS can be contained when trading reopens after the expected May 1-18 outage. Among actively traded shares, airline system China Eastern gained 5.4%, recovering from an earlier steep sell-off.
South Korean shares jumped more than 3% in early trading due to U.S. gains and renewed optimism for a peaceful end to the North Korea (news - web sites) nuclear standoff. The U.S. is reviewing a North Korean proposal to surrender its missiles and nuclear facilities in exchange for substantial U.S. economic benefits, U.S. Secretary of State Colin Powell (news - web sites) said Monday. Samsung Electronics, the country's largest company by market capitalization, gained about 2.5%, while SK Telecom moved ahead 3.5%. Kookmin Bank rose 3.7%.
Taiwanese shares advanced early Tuesday in a technical rebound after shedding more than 400 points in the past three days. The benchmark index of the Taiwan Stock Exchange was up about 1.5% at midday, led by Taiwan Semiconductor Manufacturing, which added 0.9% and its rival, United Microelectronics, also up 1.%. The two semiconductors are scheduled to report respective first-quarter earnings later Tuesday and Wednesday. The two are expected to report that their industry hit bottom in the first quarter and is now heading for a significant rebound in the second quarter.
Recovery in SARS-affected stocks helped the New Zealand market extend early gains. Air New Zealand added 5.4%, while in other market action, Telecom Corp. of New Zealand gained 2.4%.
Across the Tasman Sea, Australia's All Ordinaries index rose 1.1%. Airline Qantas rose 6.3% on hopes for an early end to the SARS outbreak.
In the Philippines, stock prices climbed 1.2%, as bargain hunting erased five sessions of losses, including Monday's 1.2% fall.
Markets in Japan were closed for a holiday.
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