Asian Markets End In Positive Territory

The markets across Asia ended in positive territory but well off the highs in the second trading session on Tuesday, encouraged by the sharp gains on Wall Street in the previous session. Higher commodity prices also lifted market sentiment with resource stocks leading the gains.

In Japan, the benchmark Nikkei-225 Index added 27.04 points, or 0.3%, to 10,682, while the broader Topix index of all First Section issues was added 3.82 points, or 0.4%, to 920.

On the economic front, the Bank of Japan revealed that the monetary base in the country rose 5.2% year-over-year during December, following an year-over-year rise of 3.8% in the month of November. The central bank further noted that banknotes in circulation were down an annual 0.3%, while coins in circulation fell 0.7% on year. The current account balance was up 53.6%, including a 47.4% annual increase in reserve balances.

In a separate statement, the the Japan Automobile Dealers Association said auto sales increased for the fifth consecutive month in December. Domestic sales of new cars, trucks and buses increased 36.5% year-on-year in December. Automobile sales totaled 250,474 units in December, larger than 183,549 recorded in December 2008. However, for the calendar year 2009, automobile sales declined 9.1% to 2.92 million vehicles

Commodity related stocks led the gains on higher commodity prices in the international market. Impex, the oil exploration company, rose 1.82%. Nippon Oil Corp. surged up 7.39% and Nippon Mining Holdings soared 7.25%. Showa Shell climbed 1.84%.

Among trading companies, Mitsubishi Corp. advanced 2.50%, Mitsui & Co. climbed 2.85%, Itochu Corp. rose 2.45%, Marubeni Corp. gained 2.66%, Sumitomo Corp. added 1.24% and Toyota Tsusho Corp. edged up 0.43%.

Banks also ended in positive territory after Sumitomo Mitsui Financial announced that it would raise only 800 million yen to replenish the capital, lower than earlier expection of capital raising in excess of 1 trillion yen. The shares of Sumitomo Mitsui Financial advanced 1.45%. Among other large banks, Mizuho Financial rose 1.23% and Mitsubishi UFJ Financial added 0.22%, on relatively large volumes. However, Resona Holdings bucked the trend and ended in negative territory with a loss of 0.21%.

Automotive stocks ended in negative territory, offsetting the early gains in the market partly, following strengthening of the local currency against the US dollar. Toyota Motor Corp. declined 2.19%, Suzuki Motor fell 1.78%, Honda Motor slipped 0.79%, Hino Motors shed 0.93% and Mitsubishi Motor declined 1.53%.

In Australia, the benchmark S&P/ASX Index advanced 48.00 points, or 0.98% to close at 4,924, while the All-Ordinaries Index ended at 4,839, representing a gain of 49.70 points, or 1.02%.

On the economic front, survey results released by Australia's Housing Industry Association revealed a modest increase in new home sales for the month of November, reversing the unexpected slump in October. The results revealed that new homes sales rose 0.3% during November from October.

Mining and metal stocks led the gains on higher commodity prices. BHP Billiton added 0.46%, Fortescue Metals gained 2.45%, Gindalbie Metals surged up 6.48%, Iluka Resources rose 3.62%, Macarthur Coal climbed 3.00%, Oz Minerals soared 5.00% and Rio Tinto advanced 1.91%.

Oil stocks also ended in positive territory after crude oil prices surpassed the $81 a barrel mark in the international market. Woodside Petroleum advanced 0.93%, Santos gained 1.47%, Oil Search added 0.33% and Origin Energy climbed 2.80%.

Gold stocks also gained on higher bullion prices. Lihir Gold gained 1.52% and Newcrest Mining rose 2.00%%.

Banking stocks also advanced on increasing optimism about global recovery. ANZ Bank added 0.48%, Commonwealth Bank of Australia gained 1.51%, National Australia Bank rose 1.28% and Westpac Banking Corp. advanced 0.83%. Investment banker Macquarie Group climbed 1.93%.

Retail stocks were the laggards in the market having ended mixed after Harvey Norman was downgraded by JP Morgan. David Jones fell 1.32%, Harvey Norman slumped 2.94%, JB Hi-Fi fell 2.19% and Woolworths slipped 0.60%. However, Wesfarmers bucked the trend and ended in positive territory with a gain of 1.31%.

In Hong Kong, the Hang Seng Index ended sharply higher with a gain of 456.30 points, or 2.09%, at 22,280, primarily led by resource related stocks on higher commodity prices in the international market. Positive closing on Wall Street in the previous session on increasing optimism about economic recovery also lifted market sentiment with risk appetite returning to the market. As many as 37 of the 42 components in the index ended in positive territory. Aluminum Company of China or CHALCO surged up 9.08%, while CNOOC climbed 5.72% and PetroChina soared 5.92%.

In South Korea, the KOSPI Index ended in negative territory with a marginal loss of 5.52 points, or 0.33%, at 1,69, as traders preferred to lock in gains following recent gains and move to sidelines awaiting further data. Automotive stocks were the major draggers in the market on strengthening local currency, Korean Won, as a stronger local currency reduces the export sales realizations in local currency on conversion. Liquidity concerns related to Kumho Asiana Group also impacted market sentiment.

A return in risk appetite amid improving corporate earnings outlook along with a rally in the U.S and the European markets overnight lifted the Indian market notably higher on Tuesday. Metal stocks outperformed tracking gains among their global peers on the back of higher commodity prices, followed by high-beta realty and telecom stocks, but profit taking in the auto sector limited large gains in the frontline indexes. The benchmark Sensex finished at 17,686, up 128 points or 0.73% and the Nifty rose by 46 points or 0.87% to 5,278.

Among other major markets open for trading in the region, Indonesia's Jakarta Composite Index advanced 29.86 points, or 1.16% to close at 2,605, Taiwan's Weighted Index edged up 3.55 points, or 0.04% to close at 8,211, Straits Times Index in Singapore gained 25.73 points, or 0.89%, to close at 2,920, and China's Shanghai Composite Index rose 38.42 points, or 1.18%, to close at 3,283.