Asian stocks rise on US stimulus hope

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HONG KONG: Asian stocks gained Friday, with Tokyo clawing back some ground after plunging in the previous session as tepid US data eased concerns that the Federal Reserve could begin tapering its aggressive stimulus programme.

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Tokyo climbed 1.62 percent after the Japanese government released a barrage of economic data just before the market opened, including a stronger-than-expected on-month rise of 1.7 percent in April factory output.

But the industrial data rise was tempered by other figures showing that the export powerhouse remained mired in deflation.

The benchmark Nikkei index on Thursday lost 5.15 percent as jittery investors dumped shares on the back of a stronger yen and mounting concerns over global growth.

In other markets, Hong Kong rose 0.39 percent, Seoul gained 0.23 percent, Sydney was up 0.14 percent while Shanghai traded flat.

The Dow Jones Industrial Average added 0.14 percent to 15,324.53 on Thursday as weaker-than-expected economic news fuelled hopes the Federal Reserve will continue to keep its foot on the stimulus pedal.

New claims for unemployment insurance benefits unexpectedly rose in the US last week, by 10,000, and pending home sales edged up 0.3 percent in April, when 1.5 percent was forecast.

The US government’s revised estimate of first-quarter economic growth came in barely changed at 2.4 percent. Analysts had expected that it would hold unchanged at 2.5 percent.

The lacklustre figures were “seen to support the (Federal Reserve) maintaining its aggressive stimulus measures” which tend to weigh on the dollar, National Australia Bank said.

“Looking ahead, next week’s payrolls data, ISM manufacturing and key Fed speeches will be crucial to shaping expectations about the timing for tapering (monetary easing),” it added.

In currency markets, the dollar firmed to 101.01 yen in early Asian trade from 100.74 yen in New York late Thursday.

The euro, meanwhile, drew support from an encouraging eurozone indicator showing economic sentiment rose in May. The single currency bought $1.3040 and 131.85 yen against $1.3043 and 131.39 yen.

Markets will keeping an eye on eurozone inflation and jobless rates later in the day, dealers said.

Oil was down in Asia, with New York’s main contract, light sweet crude for delivery in July dropping eight cents to $93.53 a barrel and Brent North Sea crude for July delivery shedding seven cents to $102.12.

Gold was at $1,419.30 at 0300 GMT from $1,399.52 late Thursday.

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