Asian shares climb on strong US, EU manufacturing reports

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HONG KONG: Asian markets enjoyed a healthy rally on Wednesday following positive manufacturing data from the United States and Europe, while Tokyo was also boosted as the dollar pushed toward the 104-yen level.

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Traders were given a strong lead from New York, where the S&P 500 closed at another record high, while attention turns to the release Friday of a closely watched US jobs report.

Tokyo climbed 1.04 percent, or 154.33 points, to close at 14,946.32, Seoul rose 0.26 percent, or 5.27 points, to close at 1,997.25 and Sydney added 0.26 percent, or 14.1 points, to close at 5,403.3.

Hong Kong was 0.34 percent higher, adding 74.50 points to 22,523.94 while Shanghai put on 0.56 percent, or 11.53 points, to 2,058.99.

Global shares broadly swung up on Tuesday following the release of upbeat reports on manufacturing in China, Europe and the United States.

Beijing said at the start of the trading day that its official purchasing managers index (PMI) had ticked up in March after hitting an eight-month low in February, beating expectations.

Markit Economics said its eurozone PMI for March stood at 53.0. The figure is down from February’s 53.2 but the average reading over the first quarter as a whole was 53.4, which it said was the “the best outcome since the second quarter of 2011”.

A reading above 50 denotes expansion while anything below points to contraction.

Later, the US Institute for Supply Management said its PMI hit 53.7 from 53.2 the previous month. ISM also said comments from businesses surveyed “reflect favourable demand and good business conditions”.

Wall Street surged on the upbeat numbers. The S&P 500 jumped 0.70 percent to its first record close since March 7, while the Dow added 0.46 percent and the Nasdaq climbed 1.64 percent.

‘Dollar could touch 105 yen’
On forex markets the euro sat at $1.3800 compared with $1.3793 late in New York, while it also bought 143.24 yen, up from 142.98 yen.

The euro’s move higher came before the European Central Bank reviews its interest rates policy on Thursday, with earlier expectations receding of a move to ease rates to address low inflation.

The dollar rose to 103.93 yen at one point before easing a tad to sit at 103.79 yen, against 103.66 yen in New York as investors grow more confident about higher-risk assets, in turn moving out of safer bets such as the yen.

“If [Friday’s jobs data] beat the market forecast, the dollar may start rising toward 105 yen,” said Masafumi Yamamoto, chief strategist at Praevidentia Strategy.

Investors will be closely watching the payrolls report for a better handle on the state of the US economy following weak readings at the start of the year caused by severe cold across much of the country.

Oil prices edged higher. New York’s West Texas Intermediate for May delivery rose two cents to $99.39 76 a barrel in afternoon trade and Brent North Sea crude for May was up 14 cents at $105.76.

Gold fetched $1,283.40 an ounce at 0800 GMT compared with $1,284.41 on Tuesday.

AFP

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