Asian markets up on China data, weak yen lifts Tokyo

PHOTO: Asian markets up on China data, weak yen lifts Tokyo

HONG KONG - Asian shares posted strong gains Friday after China released data showing a better-than-expected pick-up in the economy for the past four months, while Tokyo was boosted by another fall in the yen.

The dollar climbed to a new two-and-a-half-year high against the Japanese unit while the euro also jumped on expectations the Bank of Japan will unveil another huge stimulus package and set a two-per cent inflation target.

Tokyo soared 2.86 per cent, or 303.66 points, to 10,913.30, Hong Kong was up 1.12 per cent, or 262.02 points, at 23,601.78 and Shanghai put on 1.41 per cent, or 32.16 points, to 2,317.07.

Seoul added 0.69 per cent, or 13.58 points, to 1,987.85 and Sydney gained 0.31 per cent, or 14.6 points, to 4,771.2.

Beijing said the world's number two economy expanded 7.8 per cent in 2012, better than the government target of 7.5 per cent, marking a second straight year of easing owing to weakness in key overseas markets.

It also said gross domestic product grew 7.9 per cent in the October-December period, snapping seven straight quarters of slowing growth.

Economists surveyed by AFP had projected GDP growth of 7.7 per cent in 2012 and 7.8 per cent in the fourth quarter.

The figures reinforce recent indications that the economy will not suffer a so-called hard landing and is emerging from a drawn-out slumber that has had a knock-on effect on other countries.

"In the market now hard landing concerns are lower, we expect stable growth for the rest of the year," Haibin Zhu, chief China economist at J.P. Morgan in Hong Kong, told Dow Jones Newswires.

Tokyo shares were lifted by a further weakening in the yen after the Nikkei business daily said the Bank of Japan was preparing to unveil fresh monetary easing measures at its policy meeting next week.

Japan's economy minister Akira Amari said Friday that talks with the bank were getting closer to what the government wants, suggesting they have almost reached an agreement for it to set a two-per cent inflation target.

"Things are going in a good direction," he said at a regular press conference. "I think we'll be able to announce something after the BoJ meeting next week."

Amari's comments came after he and Finance Minister Taro Aso met bank chief Masaaki Shirakawa for talks the Nikkei said likely focused on the inflation pledge and plans for an open-ended asset purchase scheme

Shinzo Abe and his Liberal Democratic Party were swept to power last month on a promise of bigger spending and a call for the BoJ to follow a more aggressive easing policy to boost the economy.

The dollar climbed to 90.21 yen at one point in Tokyo trade on Friday, its highest since June 2010, and up from 89.86 in New York late Thursday. However, it fell back slightly to 90.02 in the late afternoon.

The euro climbed to 120.43 yen compared with 120.20 yen in New York.

In Asia on Thursday the dollar had sat at 88.72 yen and the euro fetched 117.86 yen.

The euro bought $1.3379 in Tokyo Friday, from $1.3375 in New York Thursday.

"The BoJ's words served to allay some of the scepticism about the possibility of further yen weakening that have hit the market lately," SMBC Nikko Securities general manager of equities Hiroichi Nishi told Dow Jones Newswires.

Wall Street provided a useful lead as it ended in positive territory thanks to upbeat economic data.

The US Labor Department said new jobless claims dropped last week to the lowest level in five years in the week ending January 12, while Commerce Department data showed the number of new houses under construction rebounded strongly in December.

The Dow rose 0.63 per cent, the S&P 500 added 0.56 per cent and the Nasdaq jumped 0.59 per cent.

Oil prices slipped. New York's main contract, light sweet crude for delivery in February fell five cents to $95.44 a barrel in the afternoon and Brent North Sea crude for March delivery fell 12 cents to $110.98.

Gold was at $1,689.88 at 1100 GMT compared with $1,681.70 late Thursday.

In other markets:

Taipei rose 1.53 per cent, or 116.23 points, to 7,732.87.

TSMC added 2.22 per cent to Tw$101.5 while Chunghwa Telecom was 0.84 per cent higher at Tw$94.7.

Manila closed 1.10 per cent higher, adding 67.03 points to 6,139.21.

Philippine Long Distance Telephone Co. rose 3.17 per cent to 2,800 pesos while SM Prime Holdings gained 0.36 per cent to 16.60 pesos.

Wellington fell 0.78 per cent, or 32.63 points, to 4,164.18.

Contact Energy lost 1.34 per cent to NZ$5.16, Telecom was off 1.27 per cent at NZ$2.34 and Fletcher Building gained 0.44 per cent at NZ$9.15.

Singapore closed up 0.50 per cent, or 16.12 points, at 3,211.22.

Car distributor Jardine Cycle & Carriage gained 1.25 per cent to Sg$49.30 while United Overseas Bank fell 0.11 per cent to Sg$18.76.

Bangkok gained 0.95 per cent, or 13.49 points, to 1,434.44.

Telecoms company Advanced Info Service added 3.78 per cent to 206.00 baht, while Siam Cement edged up 1.88 per cent to 434.00 baht.

Kuala Lumpur shares fell 0.28 per cent, or 4.65 points, to 1,676.44.

Sime Darby eased 1.4 per cent to 9.39 ringgit and Felda Global Ventures Holdings dipped 0.7 per cent to 4.57.

Jakarta added 1.53 per cent, or 67.10 points, to 4,465.48.

Telecoms firm Telekomunikasi Indonesia gained 2.62 per cent to 9,800 rupiah and food manufacturer Indofood Sukses Makmur lost 2.46 per cent to 5,950 rupiah.

Mumbai rose 0.38 per cent, or 75.01 points, to 20,039.04.

Indian Oil Corp rose 10.46 per cent to 348.95 rupees while Bharat Petroleum Corp rose 9.64 per cent to 434.05 rupees.