Hong Kong, Korea, India Reach New Highs in Asia

123jump.com Staff
20 Jul, 2007
New York City

Asian markets continued their advance supported by higher metals and oil prices and better earnings forecasts. LG Electronics surged 6% on a swing to profit in the second quarter lifting Korea to a record close. Steel makers lifted Japan higher. India jumped on telecom stocks. In Hong Kong financials and telecom stocks led the rally.

[R]11:30AM New York, 10:00PM India – Korea, India and Hong Kong close at record in Asian trading.[/R]

Asian Markets across the region advanced on rising oil and metals prices, higher earnings, and positive sentiment in New York and European trading a day ago. Shanghai led the region with a sharp rise of 4.3% followed by 2.36% rise in South Korea, 1.4% gain in Indonesia, 1.3% rise in Singapore, 1.2% in increase in Taiwan, and 1.2% ahead in Hong Kong, and 0.6% edging up in Australia. Japan increased a fraction 0.23%.

In Korea trading LG Electronics jumped 6% on earnings of 384.6 billion won in the second quarter compared to a loss of 9.7 billion a year ago. The strong earnings prompted rating revision from local brokers. The second largest mobile phone operator earnings lifted Samsung Electronics by 4%. Posco jumped nearly 4% on the statement that it plans to expand its production. Korea Zinc jumped 6% on firm metal prices in overnight trading in Europe. Kospi Index jumped 2.4% or 45.64 at close to record level of 1,983.54.

In Hong Kong trading Han Seng Index gained 1.2% at 23,291.90 to a record close lifted by financials, insurance, and telecom stocks. China Mobile jumped 2.5% after the company reported that it added 5.53 million new subscribers in June, driven by promotions and discounts. Insurance companies China Life increased 2.6% and Ping An gained 2.5%.

In Tokyo trading Nikkei 225 Index added 0.23% to close at 18,157.93. Industrials, technology and steelmakers lifted the sentiment. Ahead of earnings, Nippon Steel and JFE Holdings added 3.9% on hopes of better earnings. JFE has guided earnings for the first half to increase 12% to 150 billion yen on 13% sales increase to 1.68 trillion yen. Matushita Electric jumped 1.5% ahead of earnings next week. KDDI, mobile phone operator, fell after its reduced its subscription price for new subscribers by 50%.

In Mumbai trading Sensitive 30 Index increased 0.1% to 15,565.55, record close. The index edged higher on strength in telecom stocks and steady fund flows from international investors. Reliance Communication jumped 0.7% after adding more than 2% in the previous session on a deal to sell 5% stake in its telecom tower unit for $338 million to a group of private equity investors. The deal values the infrastructure unit at $6.5 billion. Bharti Airtel jumped 3% on the news hoping for a similar deal for its tower unit. Satyam reported earnings of 3.78 billion rupees on 27% rise in sales to 18.3 billion rupees. The stock fell 2% on the news. Larsen & Toubro jumped 4.2% on net income of 3.77 billion rupees. Company secured projects worth $180 million in the quarter. Gujarat Ambuja profit surged 168% on 16% increase in revenue to $180 million.


[R]9:00AM New York – Earnings news dominate the New York opening[/R]

Earnings reports from several companies in the technology, banking, and industrial sectors dominated the trading sentiment. Market averages are likely open lower in New York on a decline in Google, Microsoft, and Caterpillar.

Citigroup reported second quarter earnings of $6.23 billion from $5.26 billion a year ago on revenue 20% gain in revenue of $26.6 billion. Earnings per share jumped to $1.24 from $1.05. International revenue jumped 34%, on recent acquisitions, to $12.6 billion and earnings surged 35% to $3.04 billion. Earnings in the investment banking jumped to $2.83 billion from $1.72 billion. The Global Wealth Management division which includes the Smith Barney brokerage services, earned $514 million, 48%, on a global rise in earnings.

Caterpillar Inc ((CAT)) earnings dropped to $823 million from $1.05 billion on 7.1% revenue increase to $11.4 billion. Earnings per share declined to $1.24 from $1.52. The company restated the annual earnings guidance between $5.30 and $5.80 per share and revenue of $44 billion in the year 2007. The company also lowered its forecast of new home construction to 1.4 million from 1.5 million. Engine sales in the North America declined 7.5% from a year ago due to higher demand of engines last year ahead of tigher emissions standard.

Google dropped 7% in the morning hours after disappointing some aggressive growth investors and Microsoft is down 3% on charges related to Xbox repairs. Caterpillar lost 5% on 7% decline in earnings. Whirlpool is ahead 2% on 77% jump in earnings. sanDisk jumped 7% on its quarterly profit on strong sales in Europe. Advanced Micro Devices jumped 2% and reported sales gain of 13% to $1.38 billion in the second quarter.

Apple Inc traded at record high to $142 on a favorable report from Piper Jaffrey and a revised price target of $205.