Hong Kong Surges 14%, Asian Rally

123jump.com Staff
28 Oct, 2008
New York City

Asian markets closed sharply higher as investors search for bargains. Japan surged more than 6% and Hong Kong soared 14% in the largest one-day gain in a decade. Honda Motor reported a decline in net income on 81% drop in profit in North America and a rise in yen.

[R]9:30AM New York – Asian markets rally after investors search for bargains.[/R]

Stocks in Europe and Asia rally after bargain hunters look for opportunities.

However, countries with current account deficit remain under pressure. Korea and India have seen large outflows of capital from markets dragging their currencies lower. Australia fell again on the weakness in metals and energy prices.

Yen dropped nearly 2 yen to 95.35 yen to a dollar and 3 yen against euro to settle at 119.35 yen to a euro. The yen dropped as much as 3 yen against dollar and 4 yen against euro after Group of Seven issued a rare statement pointed at yen volatility and its recent rise.

Honda Motor ((HMC)) surged 14% to 2,065 yen after it reported third quarter net income of 123.3 billion yen ($1.3 billion) or 67.96 yen a share compared to 208.5 billion ($2.09 billion) or 114.94 yen a year ago. Operating profit in North America dropped 81% on lower sales and higher gasoline prices. Rising yen also lowered profits outside Japan.

Hynix Semiconductor Inc. increased 15% in Seoul, South Korea trading.

Stocks in Hong Kong surged 14%, a single largest one-day gain in ten years. China Railways and Cathay Pacific soared 30%. HSBC Plc increased 20%, ICBC surged 16% and Bank of East Asia Ltd. gained 10% after it estimated credit derivatives related losses of HK$2.2 billion.

Markets in India were closed for Diwali celebration.

The Fed is expected to make a rate decision this Wednesday as market expectations are building for 50 basis points rate cut.

Crude oil price in Asian and European trading edged higher but traded near sixteen months low.

BP Plc rose 7% to 466 pence after it reported third quarter income increase of 83% to $8.05 billion.

Aviva Plc gained 11% to 272 pence after it reported sales rise of 12% for the nine months

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 459.02 or 6.41% to 7,621.92, Hang Seng index in Hong Kong increased 1,580.45 or 14.35% closed to 12,596.29. CSI 300 index in China higher 51.15 or 3.09% closed to 1,705.82. ASX 200 index in Australia decreased 14.60 or 0.38% to close 3,794.60. The KL Composite index in Malaysia lower 26.67 or 3.10% closed to 832.44.

The Kospi Index in South Korea increased 52.71 or 5.57% to close at 999.16. SET index in Thailand closed higher 10.61 or 2.74% to 398.04 and JSE Index in Indonesia decreased 55.02 or 4.72% to 1,111.39. Markets in India were closed today.

Europe Markets Review

In London FTSE 100 Index traded higher 93.62 or 2.43% to 3,946.21, in Paris CAC 40 Index increased 76.91 or 2.51% to 3,144.26 and in Frankfurt DAX index traded higher 285.30 or 6.58% to 4,619.94. In Zurich trading SMI increased 162.81 or 2.96% to 5,663.75.