Asian stocks rose broadly on Thursday, as gains in U.S. housing starts and strong earnings reports from U.S. tech majors eased worries about a sharp slowdown in corporate profit growth. Fed Chairman Ben Bernanke reiterated his stance to use all tools to boost the economy if the situation gets worse and Chinese Premier Wen Jiabao vowed to make efforts to create more jobs as part of a development strategy to boost sagging economic growth, helping keep underlying sentiment positive.
The dollar remained under pressure as Bernanke offered a grim picture of the U.S. economy and kept hopes for more more stimulus measure alive. He played down the risks of a double-dip recession as the economy continued to expand at a moderate pace in June and early July. The Fed's Beige Book business survey released overnight showed employment levels improving at a tepid pace, while manufacturing activity continued to expand slowly in most districts.
Tokyo stocks ended higher, bolstered by gains in high-tech shares following a rally among their U.S. peers overnight on the back of Intel's upbeat comments on the corporate IT market. Better-than-expected earnings from EBM and eBay also reassured investors.
Advantest soared 6.5 percent, Dainippon Screen Manufacturing jumped 6.6 percent and Tokyo Electron rallied 3.6 percent. The benchmark Nikkei average rose 0.8 percent, while the broader Topix index ended 0.9 percent higher.
China-linked Komatsu rose 3.3 percent, helped by reports that China's biggest four banks doubled their pace of lending in the first half of July from a month earlier. Japan Tobacco gained 2.4 percent on a brokerage upgrade.
Tokyo Electric Power climbed 4.8 percent after the government allowed the utility to raise its electricity rate by as much as 8.47 percent. Yaskawa Electric advanced 8.4 percent after the company raised its half-year operating profit estimate by 50 percent.
Suzuki Motor tumbled 3.8 percent, weighed down by news of labor unrest at its affiliate Maruti Suzuki's Manesar factory. All Nippon Airways slid 2.1 percent after the airline set the price for its $2.3 billion upcoming new share issuance at a discount.
China's Shanghai Composite index rose 0.7 percent to end at a one-week high, lifted by cement and construction companies, after media reports suggested that banks ramped up lending in July. Hong Kong's Hang Seng index rallied 1.6 percent to close near a two-week high.
Australian shares rallied, mirroring gains in the U.S. and Europe overnight on upbeat earnings. The benchmark S&P/ASX 200 index jumped more than 2 percent to 4206.70, a level not seen since May 15, while the broader All Ordinaries index climbed 1.9 percent. The Australian dollar hit a 11-week high against the dollar, buoyed by firmer commodity prices and improved investor sentiment after news emerged that Germany's Bundesbank is mulling buying Australian-dollar denominated assets such as government bonds possibly within weeks.
Resource stocks advanced, with Rio Tinto up a percent and BHP Billiton climbing 3 percent after treasurer Wayne Swan conceded falling iron ore prices could have a bearing on the money raised through the mineral resources rent tax. Smaller rival Fortescue jumped 4.8 percent and gold miner Newcrest added 2.6 percent.
Energy stocks also rose sharply, as international crude prices continued to show upward bias. Woodside Petroleum soared 7.5 percent, Oil Search climbed 4.6 percent and Santos jumped 5.8 percent. Westpac led the gainers in the banking sector, rising 1.6 percent, while ANZ, Commonwealth and NAB ended up about 1.2 percent each. Fairfax shares ended unchanged after it appointed Jack Cowin, a friend of the company's biggest shareholder Gina Rinehart, to its board as an independent director.
In economic news, confidence among Australian businesses declined further in the June quarter, as a cumulative 125 basis-point interest rate reduction by the Reserve Bank of Australia in the past few months failed to offset growing concerns about Europe, the latest National Australia Bank quarterly business survey showed. The business confidence index slipped to -2 in the June quarter from -1 in the March quarter.
South Korea;'s Kospi average rallied 1.6 percent in thin trading on optimism the U.S. economy is gaining some traction. Tech shares and automakers led the rally, while financials remained subdued after the nation's antitrust watchdog launched a probe into the country's top four commercial banks on suspicions that lenders colluded to rig rates on certificate of deposits. Woori Finance Holdings and Hana Financial tumbled 4.1 percent and 2.6 percent, respectively. Among the top gainers, Samsung Electronics rallied 3.6 percent and Hyundai Motor rose 3 percent.
New Zealand shares rose modestly on optimism over the ongoing earnings season. The benchmark NZX-50 rose 0.34 percent, with retailers Warehouse Group and Kathmandu Holdings pacing the gainers. Shares of Warehourse, the biggest retailer on the exchange, rose 1.6 percent to its highest level since May 22, while shares of Kathmandu Holdings gained 2.1 percent.
Heartland jumped 5.5 percent after Pyne Gould Corp sold down the bulk of its stakes in the would-be bank last week. Rubber goods and milking equipment manufacturer Skellerup rose 2.1 percent and heavyweight Telecom ended up 0.4 percent, while tech stocks Xero and Diligent Board Member Services extended declines for a second consecutive session following Tuesday's sharp gains. Shares of Fletcher Building, the nation''s largest construction company, slid 0.2 percent.
Elsewhere, India's benchmark Sensex was last trading up half a percent, Indonesia's Jakarta Composite index was gaining 0.4 percent, Singapore's Straits Times index rose 0.3 percent and the Taiwan Weighted average added 1.4 percent, but Malaysia's KLSE Composite edged down marginally.
On Wall Street, stocks posted notable gains overnight, after Intel and Honeywell reported profit that beat estimates. Buying interest was also generated by a report released by the Commerce Department which showed a bigger than expected rebound in housing starts in June. The Dow rose 0.8 percent, the tech-heavy Nasdaq climbed 1.1 percent and the S&P 500 gained 0.7 percent.
by RTT Staff Writer
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