US recovery hopes steady Asian markets

Hopes for the US economic recovery on Monday helped soothe Asian markets shaken by the eurozone's debt crisis and tensions on the Korean peninsula.

Tokyo's Nikkei Index ended the session up 0.86 percent, or 86.43 points, at 10,125.99, with consumer electronic stocks like Sony buoyed by signs of a strong US shopping season and a firmer dollar also providing support.

Hong Kong's Hang Seng index ended up 1.26 percent, or 288.97 points, at 23,166.22, recovering most of the previous week's losses, with bellwether consumer goods trading firm Li and Fung rising 4.71 percent during the day.

Sydney's S&P/ASX 200 edged up 0.44 percent, or 20.2 points, to 4,618.5.

However Shanghai's Composite Index closed down 0.19 percent, or 5.34 points, at 2,866.36, as concerns persist about Chinese efforts to cool the mainland economy.

Seoul's Kospi index, jarred by last week's deadly exchange of fire with the North and subsequent angry rhetoric, ended down 0.33 percent, or 6.26 points, at 1,895.54.

Japanese traders were more focused on the US outlook however, with signs of a strong shopping season to be followed on Friday by US jobs data that analysts say will indicate a firmer US recovery.

Kenichi Hirano, operating officer at Tachibana Securities, said market players were "starting to see US spending rise as a result of 'savings fatigue'," although it was too early to say whether strong US consumption would persist through next year.

However worries remained about the eurozone and the international bailout of Ireland, as analysts warn of further questions around other economies in the euro area.

The euro touched a fresh two-month low in Tokyo trade, even as Bank of France governor Christian Noyer, speaking in Tokyo, said he had "no doubt" that the 85 billion euro bailout agreed by the European Union and International Monetary Fund would be successful.

"The package has been clearly designed by the IMF and the EU and you can rely on the multi-decade experience of the IMF to put in place plans which are totally credible," Noyer told reporters.

However Barclays Capital strategist David Forrester was less optimistic, telling Dow Jones Newswires: "We think that rallies will remain limited in the euro and expect concerns about the other peripheral euro-area countries to continue to weigh further on the euro."

The euro fell to 1.3181 dollars -- its lowest since September -- before recovering to 1.3232 in afternoon trading in Tokyo, compared with 1.3247 in US markets Friday afternoon. The currency was quoted at 111.30 yen, flat from the level in US trade, after dipping to 111.14 yen in Tokyo morning trade.

The dollar stood at 84.12 Japanese yen, slightly up from 84.07 yen on Friday, reflecting its safe-haven status.

In Shanghai, Zhang Yuheng at Capital Securities said mainland China investors were likely to remain on the sidelines until an annual Central Economic Work Conference expected in early December.

"Sentiment remains cautious as more signs have indicated that further tightening of China's monetary policy is likely," said Zhang.

Wall Street ended a rollercoaster week on a low Friday.

The Dow Jones Industrial Average fell one percent for the week, while the S&P 500 was down 0.7 percent as the news was dominated by Ireland's 85 billion euro bailout from the European Union and International Monetary Fund.

Oil rose in Asian trade Monday, but the gains were seen as possibly brief due to the strengthening of the safe-haven dollar.

In afternoon trade, New York's main contract, light sweet crude for January delivery, gained 56 cents to 84.32 dollars a barrel.

Brent North Sea crude for January gained 53 cents to 86.11 dollars.

Gold closed at 1,366.00-1,367.00 US dollars an ounce in Hong Kong, unchanged from Friday's close.

In other markets:

-- Taipei rose 0.66 percent, or 55.02 points, to 8,367.17 after local elections in which the ruling Kuomintang won three of the five mayoral posts up for grabs Saturday.

Huaku Development closed 3.44 percent higher at 87.2 Taiwan dollars while Ambassador Hotel gained 3.49 percent to 47.5.

-- Wellington rose 0.19 percent, or 6.14 points, to 3,270.38.

-- Manila was closed for a public holiday.

-- Jakarta fell 0.33 percent, or 11.86 points, to 3,630.63.

-- Singapore's Straits Times Index closed flat at 3,158.21.

Singapore Airlines rose 0.39 percent to 15.52 Singapore dollars and Singapore Telecommunications was steady at 3.10 dollars.

-- Kuala Lumpur rose 0.26 percent, or 3.90 points, to 1,495.95.

Budget airline AirAsia gained 0.80 percent to 2.63 ringgit, Petronas Chemicals rose 1.70 percent to 5.40 and Carlsberg shed 1.30 percent to 5.91.

Source: AFP

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