Tokyo, Seoul Lead Asia Higher

Ivaylo
16 Oct, 2006
New York City

The benchmark index Nikkei 225 in Japan advanced to a fresh five-month high, adancing nearly 1%. The Composite Stock Price Kospi Index in Seoul gained 0.6% as the imposition of sanctions on North Korea helped remove some the short-term uncertainty. Hong Kong also edhed higher, tracking U.S. market and the market in Taiwan ended higher as tech stocks gave shares a boost.

[R]7:30AM Asian markets end higher, Japan and Korea lead shares higher.[/R]
Asian markets closed broadly higher. The Nikkei 225 index in Japan advanced to a fresh five-month high, increasing 0.94% to end at 16692.76. Sony rose 2.52% as it neglected new worries over increasing costs for its battery recall after reports that a number of Japanese companies were considering seeking compensation related to the problem.

The Korea Composite Stock Price Index rose 0.6% to 1356.72. Shares of South Korea Samsung Electronics edged higher 0.9% after the group posted better-than-expected quarterly net profit. The Hang Seng index in Hong Kong advanced 0.12%, to close at 18010.20, in the wake gains on U.S. markets on Friday, despite a sell-off of Chinese banking stocks to make room for Industrial & Commercial Bank of China initial public offering.

In Taiwan, a surge in the tech sector helped boost the Weighted Price Index 1.1% to 7151.42. The upward momentum was kept mainly because foreign investors anticipated good third-quarter results as the earnings season begins. Australia leading share index was up 0.5%.

[R]6:30AM European markets rise on Monday on oil, technology and bank stocks.[/R]
European markets were marginally higher on Monday. By mid morning, the FTSE 100 in London climbed 0.2% to 6,169.1, Frankfurt Xetra Dax was flat at 6,174.84, and the CAC 40 in Paris was little changed at 5,351.5.

Advancers

Banca Popolare Italiana surged 5.7% after accepting a takeover bid from rival Banca Popolare di Verona e Novara in a share swap worth over 8 billion euros. BPVN will offer 0.43% of its shares for each BPI share, while BPI shareholders will also obtain an extraordinary dividend of around 2 euros a share.

Oil shares also gained ahead of OPEC meeting later this week. Norsk Hydro gained 3.5%, while Statoil rose 3.1% and Neste Oil climbed 1.6%.

Scania, the Swedish target of MAN of Germany announced it could pay an extra dividend a share this year in a move to defend itself. Scania A shares, which carry the voting rights, added 1.6%.

Decliners

Philips, the Dutch electronics group, fell 1.1% after missing forecasts with its third-quarter core profit and shares in BPVN fell 4.6%. Shares of MAN, bidding fro Scania, fell 1.8%. Hennes & Mauritz, the Swedish clothing retailer, lost 1% after it said that same-store sales did not make any progress at all in September. Total sales, excluding currency rate changes, rose 9%, the company said.

Oil and gold

Crude oil advanced for a third day on speculation that OPEC members will formally agree at a meeting this week to cut production to counter a 21% decline in prices over the past three months. Crude oil for November delivery gained 69 cents, or 1.2%, to $59.26 a barrel in after-hours trading on the NYME.

It traded at $59.19 at 10:22 a.m. London time. Brent crude oil for November settlement advanced 56 cents to $60.08 a barrel on the London-based ICE Futures exchange.

Gold opened Monday at a bid price of $591.50 a troy ounce, up from $586.70 late Friday.

Currencies

The euro was lower against the U.S. dollar on Monday, at the beginning of a week that will see the release of closely watched U.S. inflation data. The euro bought $1.2493 in morning European trading, down from $1.2514 in New York late Friday. The British pound bought $1.8569, barely changed from its Friday level of $1.8568. The dollar slipped to 119.36 Japanese yen from 119.63 yen.

[R]5:00 AM Gold and silver futures hit highest level in more than a week.[/R]
December gold went $12.40 higher to close at $592.70 a troy ounce on the NYME, while December silver climbed 30 cents to $11.68. January platinum rose $8.70 to $1,083.30 an ounce and December palladium advanced $8.05 to $315.95. The most-active December copper contract settled 2.7 cents higher at $3.4135 per pound.

November crude oil moved higher 71 cents to finish at $58.57 a barrel. November heating oil settled up 3.01 cents at $1.7178 a gallon. November gasoline rose 1.75 cents to end at $1.4684 a gallon. October natural gas settled down 12.3 cents at $5.659 a million British thermal units.

On the New York Board of Trade, December Arabica coffee futures closed up 0.75 cent at $1.0405 a pound. March futures on raw sugar in foreign ports settled unchanged at 11.13 cents a pound, with May futures up 0.2 cent at 11.32 cents.