Asia stocks gains as Obama vows to spur US economy

Asian stock markets were mostly higher Wednesday as President Barack Obama delivered his annual State of the Union speech, vowing to create jobs and spur growth in the world's No. 1 economy.

Bangkok: Asian stock markets were mostly higher Wednesday as President Barack Obama delivered his annual State of the Union speech, vowing to create jobs and spur growth in the world's No. 1 economy.

Oil prices hovered above USD86 a barrel. In currencies, the dollar was slightly down against the yen and the euro.

Hong Kong's Hang Seng Index was up 0.4 percent to 23,893.95, although notable stocks that sank included Macau casino operator SJM Holdings — currently embroiled in an ownership dispute between founder Stanley Ho and relatives — which was down more than 5 percent.

Japan's Nikkei 225 stock average declined 0.4 percent to 10,422.03. Indexes in Malaysia, New Zealand and the Philippines were also down.

But South Korea's Kospi index rose by 0.9 percent to 2,105.96 after news the country's economy, Asia's fourth-largest, grew at its fastest pace in eight years in 2010 even though the expansion slowed in the final quarter. Gross domestic product advanced 6.1 percent last year, marking the best performance since a 7.2 percent surge in 2002.

China's Shanghai Composite index climbed 0.5 percent to 2,691.55. Markets in Singapore, Taiwan and Indonesia also rose. Australia's stock market was closed for a public holiday.

Investors seemed to regain confidence in the U.S. economy following Obama's address and an improvement in economic indicators that came on the heels of a December rally on Wall Street.

But Asian gains were tempered by profit-taking among traders expecting China to soon take more aggressive steps to cool its galloping economy and tamp down inflation.

"We continue to see encouraging signs from the U.S. market," said Amy Lee, a strategist at Nomura Global Equity Research in Hong Kong, "but the Asian market is more driven by China data."

The markets are also getting ready for the release of a slew of U.S. corporate earnings reports from companies including Boeing Co., General Dynamics Corp., Starbucks Corp., Xerox Corp. and United Technologies Corp. The Federal Reserve's first interest rate decision of the year was also expected later Wednesday.

The Fed is not expected to alter its current monetary stance, with the main interest rate at the record low of near zero percent and the central bank in the middle of a USD600 billion injection into the U.S. economy.

However, investors will be looking for any noticeable change in views on the rate-setting Federal Open Market Committee.

In Washington late Tuesday, Obama said in the State of the Union address he would boost spending for education, innovation and infrastructure as ways the government can support America's foundation and help businesses create jobs for a generation.

Obama also called for an overhaul of corporate taxes that would eliminate many loopholes and deductions in exchange for lower rates.

On Wall Street overnight, the Dow Jones industrial average slipped just 3.33 points, or less than 0.1 percent, to 11,977.19. The U.S. stocks were under pressure Tuesday on a round of disappointing earnings results including those from manufacturing company 3M.

In currencies, the dollar was quoted at 82.04 yen, slightly down from 82.20 yen in New York late Tuesday. The euro edged up to USD1.3689 from USD1.3685.

Benchmark crude for March delivery was up 27 cents at USD86.46 a barrel in electronic trading on the New York Mercantile Exchange. The contract lost USD1.68 to settle at USD86.19 on Tuesday.

Bureau Report

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