Asian market ends week mostly higher
City Index June 27, 2011 3:02 PM
<p>Asian stocks climbed, driving the region’s benchmark index to its first weekly advance in eight, and Treasuries snapped a two-day gain as European leaders voiced […]</p>
Asian stocks climbed, driving the region’s benchmark index to its first weekly advance in eight, and Treasuries snapped a two-day gain as European leaders voiced support for Greece and a slump in energy prices eased concern the global recovery will falter. The MSCI Asia Pacific Index added 0.5% early morning in Tokyo, taking its weekly gain to 1.4%. China’s Shanghai Composite Index added 0.6%, taking its gain this week to 2.3%. Premier Wen said in an opinion piece in the Financial Times that the pace of consumer-price increases will slow, easing market nerves.
The seven-day repo rate, which measures interbank funding availability, has more than doubled since the Chinese central bank ordered banks to set aside more cash as reserves for a sixth time this year on June 14. Today the seven-day repo rate fell 56 basis points to 8.48% early morning in Shanghai, according to a weighted average rate compiled by the National Interbank Funding Center.
Around five shares advanced for every three that fell on MSCI’s Asia Pacific Index. The measure is snapping seven straight weeks of losses, the longest slump since 2004. Japan’s Nikkei 225 Stock Average climbed 0.3% and South Korea’s Kospi index climbed 1.1%. The Hang Seng Index added 1.3% in Hong Kong, where Prada SpA increased 0.4% on its market debut after raising $2.1bn in an initial public offering.
In corporate news, Airlines advanced on speculation the drop in oil will help cut fuel costs. Qantas Airways Ltd. rallied 3.1% and Korean Air Lines Co. gained 2.2%. Jet kerosene in Singapore has fallen 1.4% to $124 a barrel in the week to June 23. AirAsia Bhd. climbed 1.9% in Kuala Lumpur after the discount carrier placed a record order with Airbus SAS for the A320neo jetliner.
Australian heavyweight BHP Billiton said the cost of expanding its Worsley aluminum project in Western Australia – around 200kms south of Perth – increased 58% to $3 billion and completion delayed at least six months. The complexity of expanding the refinery “has resulted in significantly lower levels of construction progress than previously anticipated, while broader inflationary pressures and the strengthening of the Australian dollar have also contributed to the cost increase,” Andrew Mackenzie, chief executive officer of Melbourne-based BHP’s non-ferrous unit, said today. BHP also today approved a further $488m investment at its Jansen potash project in Canada.
Crude for August delivery rose 1.1% to $92 a barrel on the New York Mercantile Exchange, rebounding from yesterday’s plunge. Brent crude oil tumbled more than 6% yesterday to $107 a barrel on the London-based ICE Futures Europe exchange, the lowest price since Feb. 22. Immediate-delivery gold rose 0.1% to $1,522 an ounce, paring yesterday’s 1.8% slump.
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