Asia stocks end bright week on a high

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HONG KONG: Asian stock markets climbed for a fifth-straight session on Friday following yet another record close on Wall Street and after China released data showing the economy grew more than expected in the second quarter.

Traders were on course to end one of the best weeks this year on expectations central banks around the world will ramp up stimulus measures, while a strong reading on US jobs last week also fired up confidence.

The buying was given more impetus Friday when Beijing said the world’s number two economy grew 6.7 percent in April-June, better than the 6.6 percent forecast in an Agence France-Presse poll and the same as the previous three months.

It was also better than the 6.5 percent minimum targeted by the leadership for the year, and provided hope that a growth slowdown that has dragged on the economy for years may be bottoming out.


The upbeat mood was enhanced by figures released at the same time that showed retail sales rose far more than forecast—dealing a boost to authorities attempts to retool the economy to one driven by domestic consumers rather than exports and investment.”China is on track for achieving this year’s growth target,” said Zhu Haibin, JP Morgan China chief economist. However, he warned that “investment continues to be on the weak side, especially private investment.”

Shanghai stocks ended flat, however, and Hong Kong gained 0.5 percent.

Sydney—where numerous firms with key links to China are listed—added 0.3 percent, and Seoul put on 0.4 percent.

Singapore, Taipei, Manila and Jakarta were also all sharply higher.

Tokyo finished 0.7 percent higher as it brought the curtain down on a sparkling week that saw it pile on nine percent and wipe out all the losses suffered on June 24 after the Brexit vote.

Popular messaging app Line enjoyed a blockbuster start, soaring an eye-watering 50 percent as it started trading—almost double the closing gain for its first day in New York, where it is also listed. It ended the day up 32 percent.

The sizzling debut came after a $1.3 billion share sale.

Sterling shines

Japanese stocks were also supported by a weakening yen, which has lost almost six percent this week as traders await details of a flagged stimulus package from Tokyo as well as expectations the central bank will loosen monetary policy further.

The dollar was at 105.80 yen from 105.44 yen in New York.

“Anticipation of a massive stimulus package continues to drive investor sentiment and the ensuing divergence in monetary policy between the Federal Reserve and BoJ continues to weigh on the yen,” Stephen Innes, senior trader at OANDA Asia Pacific, said in a note.

“Unlike previous Abenomic measures, the combination of both fresh monetary and fiscal stimulus is hoped to wake Japan’s economy up from its decade-long slumber.”

The pound pressed on in its recovery against the dollar after the Bank of England surprised with a decision not to cut interest rate.

AFP

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