After most of the European banks passed stress tests, the Asian stocks rose to a one month high. The Asian stock markets posted moderate gains. It was seen that the oil prices increased above $79 a barrel. Dollar too increased up as compared to the yen and the euro too strengthened. The stress tests eradicated the market uncertainties in Asia.
Major indexes such as Hong Kong’s Hang Seng and South Korea’s Kospi too went up. Director of research at Cinda International in Hong Kong Castor Pang said, “We don’t see any big jump or drop in Asia’s trading session.”
Director of institutional sales at UOB-Kay Hian Ltd., Steven Leung, said that the policy of China on credit and earnings reports would be the driving factors in the performance of the market.
The Europe bank stress tests raised stocks as the Dow Jones industrial average gained 102.32 points, to 10,424.62. Verizon, Ford and American Express Co. stated figures that topped forecasts.
Japan’s benchmark Nikkei 225 stock average rose to 80.93 points, or 0.9 percent, to 9,512.36. Mitsubishi UFJ Financial Group Inc., Japan’s largest bank, increased by 0.7 percent and Sumitomo Mitsui Financial Group gained 0.4 percent.
Standard Chartered Plc, a London based bank, increased by 1.2 percent. Canon Inc., rose by 2.5 percent in Tokyo trading.Japan’s Nikkei 225 Stock Average advanced 0.8 percent, whereas Australia’s S&P/ASX 200 Index increased by 0.6 percent. New Zealand’s NZX 50 Index increased by 0.9 percent.
LG Electronics, South Korea’s second biggest electronics manufacturer, rose by 4.2 percent to 103,500. The world’s largest maker of cameras, Canon advanced 2.5 percent to 3,530 yen. Pu Yonghao, Hong Kong based chief investment strategist for the Asia Pacific region at UBS Wealth Management, said, the stress tests “might not be vigorous enough as the tests are performed after recapitalization for the banks, but it is a piece of slightly positive news for the investing public.”
Kim Myung Kee, an official at the Bank of Korea, said, “As our economy has shown stronger-than-expected recovery, it may have already entered a phase of expansion.” In Sydney, Wesfarmers Ltd., Australia’s second biggest retailer, advanced 3.2 percent to a $30.08.
Standard Chartered advanced 1.2 percent to HK$218. HSBC Holdings Plc, Europe’s biggest bank by market value, jumped to 0.9 percent to HK$77.55. Westpac Banking Corp. advanced 1.9 percent to a $23.15 in Sydney.
Tim Schroeders, who manages approximately $1.1 billion at Pengana Capital Ltd. in Melbourne, said “The stress test results weren’t the disaster that some thought it would be.” A maker of industrial robots, Fanuc Ltd. which earns 80 percent of its revenue overseas, rose to 1.7 percent to 10,490 yen. Hitachi Ltd., which acquires 40 percent of its revenue internationally, rose by 1.2 percent to 344 yen.
The Commerce Department reported on July 14 that in June, sales at U.S. retailers declined for the second month. When the central bank stated a 1.5 % expansion in the country’s second quarter, the Kospi index in Seoul rose by 0.6 percent. This was more than the 1.3 percent median forecast in a Bloomberg News economist survey. Hang Lung Properties Ltd., Hong Kong’s third biggest developer, rose 1.2 percent to HK$33.45. Cheung Kong (Holdings) Ltd., the city’s second hugest developer, rose 1.2 percent to HK$94.10.
Among shares which fell, QBE Insurance Group Ltd., Australia’s largest insurer by market value, dropped down by 5.6 percent in Sydney to A$16.97 after its initial half insurance profit margin which missed the company’s target range.
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