Sydney, HK Advance, Japan Subdued

Ivaylo
06 Nov, 2006
New York City

Trading in Japan and South Korea was dull, but a weaker yen helped boost the Nikkei 225 Average into positive territory as investors sought out export-related shares such as automakers Toyota and Honda. Indonesia set a fresh record closing high for a sixth consecutive session on strength in banking shares ahead of an expected interest-rate cut this week. Hang Seng Index in Hong Kong set an intraday record before easing slightly to end up. Australia also rose on gains in banks and financials.

[R]7:30AM Asian markets end higher Monday, led by Indonesia, HK, Australia.[/R]
Asian markets closed higher on Monday. The Nikkei 225 ended 0.1% higher at 16,364.76. Shares of Softbank Corp fell 1.2% in Tokyo. Mixi Inc., social networking site, slipped 7% on concerns over growing competition.

Honda Motor gained 0.7%, while Toyota Motor rose 1%, with both shares benefiting from a weaker yen. Mazda Motor Corp rose 1.9% after reporting last Thursday that first-half net profit fell owing to one-off charges but raising its full-year forecasts. Konica Minolta Holdings jumped 11.1% after the group reported it has returned to profit in the first half for the fiscal year through September and increased its forecast for the full year.

Hang Seng Index in Hong Kong set an intraday record before retreating slightly to end up 186.86 points, or 1%, at 18,935.55. Leading the advance was China Mobile, whose shares jumped 3.4%. Sinopec Corp. rose 4.6% on speculation the stock may be added to the Hang Seng Index during a reshuffle expected after the market close Friday.

South Korea Kospi index fell 0.3% to 1,379.19 on weakness in exporters and semiconductor-related shares. Singapore Straits Times Index fell 0.4% and Malaysia KLSE Composite Index lost 0.5%. Shares traded in the New Zealand gained, with the NZX-50 benchmark up 0.3%. Taiwan Weighted Price Index fell 0.6% to 7,120.44.

Australia S&P/ASX 200 rose 0.2% to close at a record 5,444.10 on gains in energy and banks. Oil and gas producer Woodside Petroleum rose 1.7%, while shares of Macquarie Bank gained 1.7%. Indonesia JSX Composite jumped 1.7%, setting a fresh record closing high for a sixth consecutive session on strength in banking shares ahead of an expected interest-rate cut this week. Leading lender PT Bank Mandiri Tbk gained 2.7%.

[R]6:30AM European markets trade higher in early session on earnings results.[/R]
European markets were higher on Monday. By mid morning, London FTSE 100 climbed 0.6% to 6,187.3, while Frankfurt Xetra Dax gained 0.7% to 6,286.26, the CAC 40 in Paris added 0.4% to 5,358.82.

Advancers

Ryanair gained 3.8% after the group announced a forecast-beating 23.7% rise in its second-quarter net profit and raised its outlook for the full year.

Merrill Lynch upgraded Anglo-Dutch consumer goods group Unilever from sell to neutral following its better-than-expected third-quarter results last week. Unilever shares rose 2.4%.

German sportswear maker Adidas gained 2.5% after Barrons, the weekly investment newspaper, said it expected the shares to rise to around 50 euros a share next year if the company can achieve cost savings following its Reebok purchase and increase its US market share.

Ferrovial, the Spanish construction group, said it was looking at offers for its property division, even though the unit was not officially for sale. Ferrovial shares added 2.7%.

Decliners

Vivendi shares traded down 0.5%. Vivendi noted over the weekend that it had received a friendly expression of interest from KKR following press speculation. Vivendi said that it reviewed the proposal - which reports put at 40 billion euros - but that the expression of interest did not result in a proposal.

Shares in steelmaker Arcelor Mittal declined 0.7% in Paris. It said its third-quarter sales declined 1.6% compared to the second quarter, with net income up 20% sequentially.

Oil and gold

Oil prices slipped Monday after threats late last week of disruptions to production in Nigeria and the United States failed to materialize. Light, sweet crude for December delivery dropped 46 cents to $58.68 a barrel in on the NYME. December Brent crude on London ICE futures exchange fell 45 cents to $58.70 a barrel.

Gold declined from an eight-week high after gains in the dollar reduced the appeal of the metal as an alternative investment. Gold for immediate delivery fell $1.10, or 0.2%, to $626.30 an ounce early trading in London after earlier rising to $629.90, the highest since Sept. 7.

Currencies

The euro fell against the U.S. dollar on Monday, retreating below the $1.27 mark before the American midterm elections on Tuesday. In morning trading, the euro bought $1.2694, down from $1.2773 on Friday. The dollar rose to purchase 118.38 Japanese yen, while the British pound dropped to $1.8952 from $1.9086.

[R]5:00 AM Gold futures ended the week 5% up on strong oil, dollar.[/R]
December gold advanced $1.40 to end at $629.20 an ounce, after reaching an eight-week high of $631.30 an ounce. December silver reached a new eight-week high of $12.68 an ounce before settling 1.5 cents lower at $12.635 an ounce. The most active platinum contract, for January delivery, rose $45.20 to settle at $1,209.40 an ounce. In copper trading, the most-active December contract went 3.1 cents higher to close at $3.3225 per pound.

The front-month December light, sweet crude oil contract gained $1.26, or 2.2%, higher at $59.14 a barrel. December heating oil rose 3.78 cents to $1.6775 a gallon, and front-month December unleaded gasoline moved up 5.38 cents to $1.5069 a gallon. Natural gas for December delivery settled 7 cents higher at $7.884 a million British thermal units.

On the New York Board of Trade, Arabica coffee futures climbed in a fund-led surge that was fueled by technical buying. December coffee closed 1.9 cents higher at $1.1245 a pound, while March coffee closed 1.9 cents stronger at $1.1655 a pound. March futures on raw sugar in foreign ports dipped 0.22 cents to finish at 11.31 cents a pound.