Asian Markets Mostly Higher As Commodities Rally
(RTTNews) – Asian stock markets are mostly higher on Wednesday in holiday-thinned trading, reflecting gains in resources stocks after crude oil prices rose to two-year highs overnight and as iron ore, gold and copper prices also strengthened.
The Australian market, which resumed trading after the Christmas holidays, is modestly higher despite the weak cues overnight from Wall Street. Higher commodity prices gave a boost to resources stocks.
In late-morning trades, the benchmark S&P/ASX 200 Index is adding 12.90 points or 0.21 percent to 6,082.60, off a high of 6,092.80 earlier. The broader All Ordinaries Index is up 13.80 points or 0.22 percent to 6,181.10.
The big four banks – ANZ Banking, Westpac, National Australia Bank and Commonwealth Bank – are higher in a range of 0.1 percent to 0.5 percent.
Meanwhile, the major miners are mostly lower. BHP Billiton is advancing 0.6 percent, while Fortescue Metals is declining 0.1 percent and Rio Tinto is edging lower by less than 0.1 percent.
Gold miners are higher after gold prices rose to the highest in four weeks overnight. Newcrest Mining is adding more than 1 percent and Evolution Mining is rising almost 2 percent.
In the oil sector, Oil Search is rising 0.5 percent, Woodside Petroleum is advancing almost 1 percent and Santos is higher by more than 1 percent after crude oil prices surged to two-and-half-year highs overnight.
Shares of retailers are also gaining ground amid expectations of strong Boxing Day sales, with Harvey Norman rising almost 1 percent and JB Hi-Fi advancing more than 2 percent.
Shares of Retail Food Group, which owns brands like Gloria Jean’s and Donut King, are gaining almost 9 percent after the company said its lenders agreed to extend the life of A$150 million worth of debt facilities to 2020.
Navitas said it expects a one-time charge of A$7.5 million in its half-year accounts after the U.S. corporate tax rate was reduced recently. The education provider’s shares are down 0.2 percent.
WorleyParsons said it expects a one-time charge of between A$45 million and A$60 million against its first-half profit following the reduction in the U.S. corporate tax rate. However, the engineering group’s shares are advancing 0.6 percent.
OrotonGroup’s administrator has accepted a purchase offer from the company’s largest shareholder that will keep the luxury handbag retailer trading and help avoid a break-up or closure of the company. Shares of Oroton are currently suspended from trading on the Australian Securities Exchange.
In the currency market, the Australian dollar climbed against a slightly weaker U.S. dollar on Wednesday. In early trades, the local unit was quoted at US$0.7727, up from US$0.7714 on Friday.
The Japanese market recovered after a weak start and is modestly higher following the overnight rally in oil and metals prices and as investors shrugged off the weak lead from Wall Street.
In late-morning trades, the benchmark Nikkei 225 Index is adding 20.44 points or 0.09 percent to 22,913.13, after touching a low of 22,854.39 in early trades.
The major exporters are mostly lower on a slightly stronger yen. Mitsubishi Electric is adding 0.2 percent, while Panasonic is edging lower by 0.1 percent, Sony is declining 0.3 percent and Canon is down almost 1 percent.
In the banking sector, Mitsubishi UFJ Financial is edging down less than 0.1 percent, while Sumitomo Mitsui Financial is adding 0.3 percent. Mitsubishi UFJ Financial said it will take a 73.8 percent stake in Indonesia’s Bank Danamon.
Among automakers, Honda is rising 0.2 percent while Toyota is declining 0.2 percent.
In the oil space, Inpex is rising more than 2 percent and Japan Petroleum is gaining almost 4 percent following the surge in crude oil prices.
Among the market’s best performers, J Front Retailing is rising almost 8 percent, Kawasaki Heavy Industries is gaining more than 7 percent and Isetan Mitsukoshi Holdings is up almost 3 percent.
On the flip side, Trend Micro Japan is losing almost 2 percent, while Kirin Holdings and Fujikura Holdings are down 1 percent each.
On the economic front, Japan will release November numbers for housing starts and construction orders today.
In the currency market, the U.S. dollar is trading in the lower 113 yen-range on Wednesday.
Elsewhere in Asia, Singapore, Hong Kong, Indonesia, Malaysia and Taiwan are also higher, while South Korea, Shanghai and New Zealand are modestly lower.
On Wall Street, stocks closed modestly lower on Tuesday as a notable decline by shares of Apple weighed on the tech-heavy Nasdaq. Nonetheless, overall trading activity remained relatively light, as many traders were still away from their desks following Christmas.
The Dow edged down 7.85 points or less than a tenth of a percent to 24,746.21, the Nasdaq fell 23.71 points or 0.3 percent to 6,936.25 and the S&P 500 dipped 2.84 points or 0.1 percent to 2,680.50.
The major European markets remained closed on Tuesday in celebration of Boxing Day.
Crude oil futures surged to the highest level in more than two years Tuesday, extending recent gains after a Libyan pipeline blast threatened supplies from the region. WTI crude for February delivery jumped $1.50 or 2.6 percent to $59.97 a barrel on the New York Mercantile Exchange.