HONG KONG: South Korean and Japanese traders sent shares rallying yesterday as they returned from a long weekend while most other markets tacked on gains despite a soft lead from Wall Street. Investors started the week on a positive note Monday as they looked past a surprise drop in US jobs and bought into other positives from Friday’s employment report that indicated the world’s top economy is in rude health.
Unease over US-North Korea tensions also subsided as Kim Jong-Un’s regime did not launch, as some had feared, another long-range missile to mark Tuesday’s anniversary of the founding of the ruling party.
Still, Seoul’s Kospi jumped 1.6 per cent Tuesday and Tokyo finished 0.6 per cent up at its highest level in more than two years, as they played catch-up with the rest of Asia. Shanghai recovered from early losses to close up 0.3 per cent, as the Chinese market remained positive on the central bank’s plan to cut reserve ratio for lenders, dealers said.
Hong Kong also recovered to end at a new 10-year high, adding 0.6 per cent. There were further gains in Wellington, Manila and Bangkok.
However, Sydney was marginally lower and Singapore shed 0.1 per cent. US markets all ended down in limited trade owing to the Columbus Day holiday, with the Nasdaq snapping streaks of nine straight gains and six straight records. On currency markets the euro fought off uncertainty over Spain’s separatist crisis and rose against the dollar following a forecast-beating reading on German industrial output, which boosted expectations the European Central Bank will begin to raise interest rates soon.
Added to that were comments from ECB governing council member — and noted hawk — Sabine Lautenschlager, who said the days of easy money should be at an end, including winding in its massive holdings of bonds. The single currency was sitting in the high $1.17 region Tuesday, up almost a cent from the end of last week.
The pound was also slightly healthier. though dealers remain wary as embattled British Prime Minister Theresa May’s future looks uncertain after last week’s gaffefilled Conservative party conference speech.
May told parliament Monday she expected “leadership and flexibility” from her European Union counterpart in Brexit talks. But the European Commission hit back at her assertion it was up to Brussels to take the initiative, fanning uncertainty over the crucial negotiations. -AFP
