Trading Room home page

Asian markets lifted by positive US data

Market watch top headlines

Australian reports

World reports

Stocks to watch



December 10 2012, 8:34PM

Asian markets have mostly risen as dealers cheer an improvement in the US unemployment rate and another batch of manufacturing figures indicating China's economy is emerging from a slumber.

Investors appeared unmoved on Monday by figures confirming Japan's economy shrank in the three months to September, as traders keep their sights on Sunday's general election, which is expected to see Yoshihiko Noda's government ousted.

Tokyo ended flat, edging up 0.07 per cent, or 6.36 points, to 9,533.75, Sydney gained 0.13 per cent, or 6.1 points, to close at 4,557.9, while Seoul also closed flat, losing 0.03 points to 1,957.42.

Hong Kong gained 0.39 per cent, or 85.55 points, to close at 22,276.72, while Shanghai rose 1.07 per cent, or 21.98 points, to 2,083.77 as investors shrugged off a weak set of trade figures on Monday.

Washington on Friday unveiled figures showing the economy added 146,000 jobs in November, up from a revised 138,000 in October. Expectations had been for just 80,000 jobs to be added.

The Labour Department also said the unemployment rate dropped to 7.7 per cent last month, its lowest since December 2008, from 7.9 per cent in October.

However, the data were tempered by a University of Michigan consumer sentiment index, which declined to 74.5 from November's five-year-high of 82.7.

Traders are also nervous about the lack of progress on Capitol Hill in talks aimed at averting the fiscal cliff of tax hikes and spending cuts due to take effect on January 1 and which would likely tip the economy into recession.

Wall Street was mixed, with the Dow up 0.62 per cent and the S&P 500 gaining 0.29 per cent, but the Nasdaq losing 0.38 per cent.

In China the government said on Sunday that November had seen a double-digit increase in production at factories, workshops and mines for the first time since March.

Figures on retail sales, fixed asset investment and inflation reinforced the view that the economy is finally on the mend after seven straight quarters of slowdown in growth.

"Overall it's a quite strong set of numbers, supporting our view of rebounding GDP growth," said Lu Ting, China economist with Bank of America Merrill Lynch.

However, data released on Monday showed exports rose 2.9 per cent in November and imports were flat, while the trade surplus sank to $US19.6 billion ($A18.78 billion) from October's $US32.0 billion, and well below expectations for $US27.8 billion.

The figures indicate that while a rebound looks to be under way at home, the ongoing weakness in Europe and the United States - China's two key markets - continue to act as a weight on the economy.

HSBC economist Ma Xiaoping said the data confirm that overseas demand remains weak, while the relatively strong performance in October and September was because of strong orders ahead of Christmas.

"Looking ahead, China may have to rely more on investment to stimulate the economy if the US situation worsens," she told Dow Jones Newswires.

On currency markets the euro bought $US1.2909 and Y106.40 in afternoon Asian trade, down from $US1.2928 and Y106.64 in New York on Friday afternoon. The dollar bought Y82.40, from Y82.46.

The yen is enjoying a slight uptick after coming under pressure in recent weeks ahead of polls on December 16. Prime Minister Yoshiko Noda and his Democratic Party of Japan are expected to be beaten by the Liberal Democratic Party, headed by former prime minister Shinzo Abe.

Abe has promised to push a more aggressive monetary easing policy to kick-start the economy.

Oil prices were higher, with New York's main contract, light sweet crude for delivery in January, gaining 48 US cents to $US86.41 a barrel and Brent North Sea crude for January delivery adding 42 US cents to $US107.44.

Gold was at $US1,708.10 at 1910 AEDT, compared with $US1,696.90 late on Friday.

In other markets:

- Taipei fell 0.43 per cent, or 32.76 points, to 7,609.50.

TSMC lost 1.63 per cent to $Tw96.5 while Hon Hai Precision was 0.63 per cent higher at $Tw96.1.

- Manila fell 0.63 per cent, or 36.66 points, to 5,757.54.

- Wellington eased 0.27 per cent, or 10.75 points, to 4,030.77.

Telecom was down 0.88 per cent at $NZ2.265, Chorus fell 2.15 per cent to $NZ2.73 and The Warehouse was up 0.32 per cent at $NZ3.10.

- Bangkok was closed for a public holiday.

By Danny McCord