Asian stocks rose Tuesday on speculation central banks in Europe and the U.S. will do more to boost their ailing economies. Hopes that policy makers will take action came after a report overnight showed the U.S. manufacturing sector had contracted, the first time since July 2009. Investors are also looking ahead to the European Central Bank rate decision Thursday as well as employment data coming out of the U.S. later this week.
Australian shares were little changed ahead of a central bank meeting outcome with widespread expectations interest rates will be left unchanged at 3.5%. The S&P ASX 200 was less than 0.1% lower. Japan’s Nikkei Average was up 0.7%, South Korea’s Kospi gained 0.8% and Singapore’s Straits Times Index was also up 0.8%. In China, the Hang Seng Index was up 1.6% after closing Monday for a public holiday while the China Shanghai Composite edged 0.6% higher.
Investors in Hong Kong, coming back from a long weekend, were digesting economic data from both China and Macau. Chinese property developers continued to rise after news that house prices rebounded month-on-month in June for the first time in nine months. China Resources Land climbed 3.8% and Shimao Property Holdings was 4.6% higher. There are fears, however, that a recovery in the housing market could provoke the Chinese government to start tightening policy again.
Chinese auto stocks fell after state-run Xinhua news agency reported over the weekend that Guangzhou has imposed restrictions on small- and medium-sized cars to reduce traffic and cut carbon emissions. Guangzhou Automobile dropped 5.8% on the news, and other car companies Geely Automobile and Dongfeng Motor Group fell 3.3% and 6.4% respectively on fears that the scheme could be rolled out to other cities.
Macau casino operators fell in Hong Kong as Macau’s gambling revenue growth in June came in below expectations at 12% year-on-year. Although higher than the 7% increase reported in May, the latest score is a reminder that revenue growth has moderated from the aggressive rates of recent years. Sands China was down 1.6% and SJM Holdings dropped 0.4%.
StockMarketNews Research Team