ASIA MARKETS-Stocks rally, Tokyo hits six-month highs
Sunday June 8, 11:05 pm ET
By Richard Baum
biz.yahoo.com
SINGAPORE, June 9 (Reuters) - Japanese shares hit six-month peaks on Monday and most other Asian stock markets were a touch higher, riding up on a global rally sparked by hopes for a U.S. economic recovery.
Better-than-expected U.S. jobs data on Friday provided the latest reason to hope for better times in the world's largest economy, keeping the dollar firm.
But Japanese government bond investors saw no reason to move out of safe-haven assets, driving yields to fresh record lows.
Tokyo's Nikkei stock average (^N225 - News) rose more than 0.5 percent to hit its highest level since December 11 before closing the morning session up 0.37 percent at 8,818.34.
The market's recent gains helped bolster investor confidence in Japan's fragile banking sector and fanned hopes for an economic recovery.
"There are things in the real economy that gain from the stock market's turnaround," said Atsushi Tajima, chief manager at Mitsubishi Securities' equities department.
Sumitomo Mitsui Financial Group (Tokyo:8316.T - News), Japan's second-biggest banking group, was the most active issue by value, rising 2.45 percent. Bigger rival Mizuho Financial Group Inc (Tokyo:8411.T - News) was up 9.44 percent.
Investors elsewhere in Asia were more cautious, however, reflecting concern on Wall Street that the recent strong run in stocks may cool down this week as corporate America starts the season where it warns about earnings disappointments.
U.S. STOCKS "OVERVALUED"
"The case for a bull market is very strong and the bear market is behind us. But the stock market is overvalued, and the time for a correction is past due," said Hugh Johnson (News), chief investment officer at First Albany Corp in the United States.
Hong Kong (HKSE:^HSI - News) was down around 0.1 percent at 0300 GMT, Singapore (SES:^STI - News) was up 0.3 percent, Taiwan (Taiwan:^TWII - News) had gained 1.3 percent and South Korea (KSE:^KS11 - News) was 0.8 percent firmer. Australia was closed for a holiday.
The uncertain tone reflected a mixed close on Wall Street on Friday, where the Dow Jones Industrial Average (CBOT:^DJI - News) rose 0.24 percent to 9,062.79 but the Nasdaq Composite Index (NasdaqSC:^IXIC - News) fell 1.13 percent to 1,627.42.
That followed May jobs data that proved less dire than expected. The payrolls data showed a loss of 17,000 jobs, compared with forecasts in a Reuters poll for a loss of 39,000.
"People were saying that figures in the jobs data would be pretty bad but they weren't so bad after all," said a currency dealer at a major Japanese bank. "The dollar is firm and I expect it to remain firm for the rest of the day."
The dollar was quoted at 118.50 yen (JPY=) compared with Friday's late New York level of 118.71 yen. The euro was trading at $1.1690 (EUR=), little changed from the U.S. close at $1.1700.
The euro fell against the yen on selling by Japanese exporters and as speculators dumped the single currency on a report that French retailer Carrefour (Paris:CARR.PA - News) was seeking a tie-up with struggling Japanese retailer Daiei (Tokyo:8263.T - News).
The euro dropped as far as around 138.05 yen (EURJPY=R) from the day's high of 139.05, compared with late New York's 138.88 yen.
Japanese government bonds extended their record run, with yields on 10-year and 20-year bonds falling to all-time lows as investors doubted the country's deflation and economic woes would end soon.
The yield on the 250th 10-year JGB (0#JPTSY=JBTC) sank by 1.5 basis points to 0.490 percent and that on the 20-year dropped 3.5 basis points to 0.830 percent.
Traders said the market was paying little attention to the rise in Japanese stocks.
"The Nikkei is rising because U.S. stocks are strong. But as profit-taking set in on Friday (on Wall Street), people still have doubts over the fundamentals," said Xinyi Lu, chief strategist at UFJ Bank. |
