The Hong Kong stock market has closed higher now in back-to-back sessions, jumping more than 680 points or 3.2 percent en route to a fresh six-week closing high. The Hang Seng Index finished just above the 21,300-point plateau, and now investors are bracing for consolidation when the market kicks off trade on Thursday.
The global forecast for the Asian markets is mixed with a downside bias, thanks to profit-taking and soft employment data out of the United States. Payroll processor Automatic Data Processing reported much weaker than expected private sector job growth. Adding to the cautious sentiment are several weaker than expected manufacturing reports in Europe, in addition to a jump in the Eurozone's unemployment rate. The European and U.S. markets were mixed to lower, and the Asian bourses figure to follow suit.
The Hang Seng finished sharply higher on Wednesday with broadly based gains, although the financials and exporters were particularly sound.
For the day, the index jumped 214.87 points or 1.02 percent to finish at 21,309.08 after trading between 21,237.17 and 21,385.30 on volume of 57.85 billion Hong Kong dollars.
Among the gainers, Haitong Securities surged 6.3 percent, while Hong Kong Exchanges gathered 1.1 percent, Citic Securities added 2.0 percent, Cosco Pacific jumped 2.7 percent, China Merchants Holdings climbed 2.2 percent and Li and Fung collected 2.2 percent.
The lead from Wall Street offers little clarity as stocks turned mixed on Wednesday after initially moving lower on the weaker than expected data, with traders eventually shrugging off a disappointing private sector jobs report.
Payroll processor Automatic Data Processing said that private sector employment increased by 119,000 jobs in April following a downwardly revised increase of 201,000 jobs in March. Economists had expected an increase of 183,000 jobs compared to the addition of 209,000 jobs originally reported for March. The data raised some concerns about Friday's more closely watched monthly employment report from the Labor Department.
A separate report from the Commerce Department showed that new orders for manufactured goods fell by 1.5 percent in March following a 1.1 percent increase in February. Orders had been expected to decrease by 1.6 percent.
In corporate news, MasterCard (MA) reported better than expected first quarter results - although revelation of an increase in rebates and incentives may have raised concerns about future results. Cable giant Comcast (CMCSA) also ended the day in the red despite reporting stronger than expected first quarter earnings growth.
Meanwhile, shares of Standard Microsystems (SMSC) moved sharply higher after agreeing to be acquired by Microchip Technology (MCHP) for $829 million in cash. Charming Shoppes (CHRS) also posted a substantial gain after the retailer agreed to be acquired by Ascena Retail Group (ASNA) for $890 million in cash.
The major U.S. averages finished mixed as the NASDAQ rose 9.41 points or 0.3 percent to finish at 3,059.85, while the Dow edged down 10.75 points or 0.1 percent to end at 13,268.57 and the S&P 500 dipped 3.51 points or 0.3 percent to 1,402.31.
In economic news, the HSBC/Markit purchasing managers' index for the factory sector rose to 49.3 in April from 48.3 in March, Markit Economics said on Wednesday. The flash report showed a reading of 49.1 for April.
Despite the improvement, the below-50 reading still means contraction. The manufacturing sector has now fallen for a sixth successive month. Manufacturing production decreased for a second straight month in April. New orders fell marginally, while new export orders increased.
by RTT Staff Writer
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