Full story
Asian stocks end week with strong gains
05:26 p.m Feb 06, 1998 Eastern
By Stuart Grudgings
SINGAPORE, Feb 6 (Reuters) - A week that
began in euphoria for Asian stock markets
ended with another confidence-boosting rise on
Friday as foreign investors continued to dip their
toes
in the region.
The countries worst affected by Asia's financial
upheavals -- South Korea, Indonesia and
Thailand -- were among the best performers, as
investors afraid of being left out of a possible
recovery tentatively returned.
''A lot of funds have under performed the
indices over the last 10 trading days because
they were taking a defensive stance,'' said Chua
Soon Hock, chief strategist at Sanwa Bank in
Singapore.
''They don't want to miss out on further gains,
especially with currencies now looking more
stable,'' he said.
Indonesia shone on Friday, shooting up more
than four percent as investors bet that many of
the market's indebted companies would be
taken over by their foreign creditors.
The composite index closed 4.27 percent, or
21.94 points higher, at 535.43 on heavy volume.
The market also got a fillip from new
government moves to tackle Indonesia's
mountain of corporate debt, which stands at
$73.962 billion out of a total $137.4 billion in
foreign debt.
Radius Prawiro, the Indonesian government's
chief debt negotiator, said the International
Finance Corporation and other banks would
provide $42 billion in credit for 42 domestic
companies.
Prawiro also said the government would move
quickly to set up a bankruptcy law in line with
International Monetary Fund's requirements.
Hong Kong stocks managed a modest rise with
gains trimmed in late trade by profit-taking as
investors unloaded positions ahead of U.S.
employment data due later in the day, brokers
said.
The Hang Seng Index put on 43.73 points, or
0.42 percent, to close at 10,485.86.
Shares in Tokyo ended little changed with
stocks capped by profit-taking and forecasts of
gloomy economic conditions, brokers said.
The key 225-share Nikkei average finished
36.76 points, or 0.22 percent, higher at
17,040.06.
''The Nikkei 225 is on the way to a further
recovery, but it is now trapped in a limited
range,'' said Masaaki Higashida, a strategist at
Nomura Securities Co Ltd.
Signs that a more flexible economy will emerge
from the region's financial crisis boosted South
Korean stocks.
The main index rose more than two percent,
helped by news that a panel comprising
government, labour and corporate management
officials had struck an agreement making layoffs
easier. This would be passed into law by the
National Assembly this month, the panel said.
Morgan Stanley Capital International's (MSCI)
comment that it would increase South Korea's
weighting in its Emerging Markets Free (EMF)
index also helped boost foreign buying. But
brokers said the rise was limited by selling by
domestic institutions.
The composite index ended 2.35 percent, or
12.40 points, higher at 540.45.
Stocks in Thailand also leapt ahead as foreigners
crept back, their confidence improved by the
baht's continued rise against the dollar. The
currency was up on hopes of a positive outcome
to the IMF's current review of Thailand's
economic reforms.
The SET index closed 4.87 points higher at
534.98.
Singapore stocks rallied as investors snapped up
what they regarded as undervalued shares.
Some were sceptical of the rush to buy. ''It was
more or less herd instinct,'' said one dealer.
The key Straits Times Index ended up three
percent, or 44.76 points, at 1,536.91.
Further north, Malaysian shares also rose as the
ringgit strengthened against the dollar and
investors capitalised on good news in the region.
An announcement in the afternoon that
Moody's, the international ratings firm, had
downgraded Malaysia's foreign currency ratings
failed to deter traders.
Kuala Lumpur's composite index finished up
2.16 percent, or 15.38 points, at 728.19.
^REUTERS@ |
