Records in Australia, Hong Kong

123jump.com Staff
02 Oct, 2007
New York City

Markets in Asia closed higher led by a sharp rise in Hong Kong, Indonesia, Singapore, and Philippines, and Taiwan. Hong Kong surged 4% on the gains in banking and real estate companies. China Mobile and Chine Netcom jumped. The expected fund flows from mailnad China helped the index to cross 28,000. Australia closed at a record high on two deals. Westpac took control of the troubled mortgage lender Rams. Private equity group Carlyle and National Hire revised bid for Coates was acccepted.

[R]8:00AM New York, 8:00PM Hong Kong – Hong Kong led Asian markets and deals in Australia helped to close the index at a record level.[/R]

Asian markets closed sharply higher led by record close in several markets.

Hong Kong led the gainers with a rise of 3.9% or 1,057.28 to close at 28,199.75 followed by increases of 2.7% in Indonesia, 2.6% rise in South Korea, 1.4% in Taiwan and Malaysia, and 1.2% in Japan. Australia jumped 87.80 or 1.33% to 6,667.60.

Hong Kong index crossed 28,000 for the first time led by rising banks and real estate stocks. Rally in the U.S. stocks in the overnight trading, hopes of additional funds from mainland China, and expectations of better earnings in the third quarter helped Hang Seng index close higher.

China Mobile jumped 6.4% to HK$135.36 and China Telecom surged 11% to HK$6.50.

Banks rallied after Citigroup and UBS provided an estimate of losses. The reported losses by two banks added to a large loss of $9.6 billion, lower than what investors had estimated, prompting a sharp rally in the U.S. banking stocks and broader market indexes. Industrial Bank of China jumped 4.6% to HK$5.70, Bank of China jumped 5.3% to HK$4.38, HSBC Holdings added 1.3% to HK$144, and China Life surged 8.4% to HK$48.40.

Property stocks in China rallied as well. Sun Hung Kai Properties jumped 7% to HK$139.80, Cheung Kong Limited added 4.8% to HK$134.30, New World Development increased 2.3% to HK$22, but Henderson Land was suspended in trading ahead of company announcement.

In Sydney trading ASX 200 Index gained 1.5% or 96.2 to 6,659.90 led by a sharp rebound in bank stocks.

National Australia Bank Ltd. climbed 1.6%, Macquarie Bank Ltd., Australia''s largest investment bank and securities firm, jumped 2.7% and Babcock & Brown Ltd rose by 5.6%.

BHP Billiton Ltd gained 3.5% as it led other mining stocks as metals prices soared. Rio Tinto Group added 3.4% and Zinifex Ltd, the world''s third-biggest zinc miner, rose by 2%.

Carlyle Group and National Hire Ltd agreed to pay A$1.7 billion ($1.5 billion) for Coates Hire Ltd. Coates bid is valued at A$6.70, or A$2.2 billion. The stock jumped 5.4% to A$6.42 after the news of the revised bid.

The third revised bid was accepted by the company that rents construction equipment, vehicles, and other equipment. The offer needs 75% of shareholder vote to be conducted in December. The combined company will be renamed Ned Group with a total sales of A$990 million and operating earnings of A$202 million.

The troubled lender Rams Home Loans Group agreed to sell its branch network to Westpac Banking. Westpac will pay A$140 million for 92 branches and takeover loan obligations for the company and provide financing for A$1.5 billion. The lender relied on securities market for its funding of mortgage loans faced a turbulent market conditions to refinance its debts. Rams relied on the U.S. commercial paper market to fund its mortgage products and faced market conditions that effectively shut down all lending operations during three weeks of turmoil.

After the news of the deal Rams fell 25% to 66 cents and Westpac gained 53 cents to close at A$29.00.

[R]6:00AM New York, 7:00PM Tokyo – Stocks in Asia jumped to record highs. Tokyo added 1.2% on strength in banks, brokerage, and metals stocks.[/R]

Japan’s stock indexes rallied 1.19% boosted by financial stocks on speculation global credit markets were on the mend.

In Tokyo trading Nikkei 225 added 1.19% or 200.83 to 17,046.78, nearly two month high. Of the Nikkei 225 stocks 171 advanced, 45 slipped and 7 traded unchanged. Mitsubishi UFJ Financial Group led gainers with a surge of 5.59%, followed by Adventist Corp, rising 5.04%. Other financial stocks gained as well. Mizuho Financial Group edged up 2.64% and Sumitomo Mitsui climbed 3.86%.

U.S. stocks rallied on write downs in bond portfolio by Citigroup and UBS. Citigroup wrote off $5.9 billion in bond portfolio and UBS booked a loss of $3.4 billion in mortgage related businesses. U.S. stocks jumped after the two big banks offered insights into the extent of losses and hinted that worst may soon be over.

Metal prices also rallied, with zinc and copper increasing 1.6% and 1.1% respectively. Nippon Light Metals rising 1.95%, Mitsui Mining and Smelting Company soaring 1.83% and Sumitomo Metal Industries jumping 1.68%.

The yen bucked the downtrend against the dollar, trading at 115.33 per dollar from 115.74.

Of the Nikkei 225 index stocks, Mitsubishi UFJ Financial Group led the advancers with a rise of 5.6%, followed by increases of 5.1% in Advantest Corporation, 4.96% in Nomura Holdings, 4.70% in Clarion Company Limited, and 4.44% in Sumitomo Trust.

Mazda soared 0.84% on news the company has developed a catalyst to cut the use of expensive metals by 90% while maintaining performance. It however maintained outlook for a net loss of 15 billion yen because of high taxes.

Kikkoman Corp led the decliners with a sharp fall of 7.92%, followed by losses in IHI Corporation of 6.05%, of 3.93 in Mitsubishi UFJ Nicos. Fuji Electric Company and Ajinomoto Company Inc shed 3.65% each.

Qimonda Ag announced today it would be partnering Sony Corp to form a joint venture company Qreatic Design to develop DRAM chips electronics including camera, televisions and other consumer electronics. Sony and Qimonda will own equal stakes in the venture that is expected to begin operations by end of year. Qimonda Ag is 86% owned by Infineon Technologies AG. Elpida, largest DRAM chip maker in Japan, fell 150 yen to close at 3,940 after the news of the joint venture. However, chip equipment makers Advantest added 180 yen to 3,750 and Tokyo Electron added 4.3% to 7,560 yen.

According to Matsushita Electric Industrial Co spokesman Akira Kadota the company will triple annual capacity at the No.2 factory in Hyogo, western Japan to 6.6 million plasma panels from the 2.2 million units currently produced to meet demand.

The company also said it sold 17 distribution centers last month to Pro Logis, the world’s largest publicly traded industrial developer, for 85 billion yen.

In other Asian markets trading Hong Kong, Australia, and Korea closed at record highs. Australia rose 1.3% to 6,667.60, Hong Kong increased 3.9% to 28,199.75 and Korea edged 2.6% higher to 2,014.09. Taiwan jumped 1.4% to 9,623.25.