-- Asian stocks rise on stimulus hopes
-- Nikkei gains 0.5%, Hang Seng Index flat, S&P ASX 200 up 0.7%
-- Australia touches seven-week high
Asian stocks rose on Wednesday, pushing Australia to a seven-week
high, and oil rallied overnight on hopes European and U.S. central
banks will issue more stimulus measures to help economic growth.
"Macro factors are the market movers right now, with everyone
expecting more rate cuts and currency printing," said CLSA Japan
equity strategist Nicholas Smith in Tokyo.
Investors are looking towards a European Central Bank rate decision
meeting on Thursday, as well as U.S. employment data on Friday, which
is expected to encourage the Federal Reserve to implement more policy
easing.
Sentiment was also helped by news that orders for U.S. factory goods
were up 0.7% in May, reversing two months of declines, which helped
the Dow Jones Industrial Average to climb 0.6% Tuesday ahead of the
Fourth of July national holiday.
Oil prices benefited not only from the growing expectations for
stimulus that may spur the global economy and boost demand, but also
from the situation in Iran. The parliament there drafted a bill on
Monday to prevent tankers belonging to countries that impose sanctions
on the country from passing through its territorial waters, thereby
hindering supply.
Crude was at $87.65, keeping the heavy 4.7% gains made overnight, and
putting oil 12.8% above its year-to-date low.
Higher oil prices gave a boost to oil companies: in Australia, Aurora
Oil and Gas climbed 3.2%, in Japan, Inpex Corp gained 3.5%, while in
Hong Kong, CNOOC was 0.8% higher.
Australia's S&P ASX 200 was up 0.7%, after touching a seven-week high
at 4164.4 earlier in the session, as resource companies led
broad-based gains after commodity prices surged and offshore equities
keep rising on hopes of policy stimulus.
"We are seeing an unwinding of the excessive downward momentum in
resources," said RBS Morgans principal investment adviser Christopher
Macdonald in Australia.
Gold eased slightly to $1617.30 an ounce, keeping most of its
overnight gains, driven by the greater hopes of quantitative easing.
Japan's Nikkei was 0.5% up, South Korea's Kospi also gained 0.3%, and
Singapore's Strait Times Index was 0.3% higher.
In China, the Shanghai Composite climbed 0.2%, while Hong Kong's Hang
Seng Index was flat.
At $1.2591, the euro had lost some of its 0.3% overnight gains; while
the dollar fell against the euro to 79.65, compared to 79.79 late
Tuesday.
In company news, Renesas Electronics advanced 2% in Tokyo, after
investors reacted well to a series of restructuring steps announced
Tuesday. The company said it will consider closing 12 of its 19
domestic plants, and expects that up to 6,000 of its 42,800 employees
to accept voluntary retirement, leading to annual savings of Y43
billion.
Write to Daniel Inman at Daniel.Inman@wsj.com
(END) Dow Jones Newswires
July 03, 2012 22:05 ET (02:05 GMT)
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