Asian stock markets were getting a lift Monday from China data released over the weekend that indicated a pick up in activity in that key economy. Most regional banks were rising as investors enjoyed some clarity on the much-anticipated Basel capital rules.
Japan’s Nikkei 225 Index garnered 82.65 points, or 0.9%, to close the week’s first session at 9,321.82
Hong Kong’s Hang Seng Index vaulted 400.96 points, or 1.9%, to 21,658.35
Japanese stocks were broadly higher, though in light volume. "Some investors are staying on the sidelines before the Democratic Party of Japan (DPJ) presidential election tomorrow (TSE 1st section volume was just 700 million shares), but overall sentiment is good today," said Hikaru Sato, senior technical analyst at Daiwa Securities Capital Markets.
The yen's weakness against the euro was helping exporters with Kyocera up 1.6% and Toshiba up 2.0%.
Bank stocks were helped in several markets after the Basel Committee on Banking Supervision decided to significantly increase the amount of capital banks must set aside against potential losses, but allowed banks time to adapt to the new rules.
Mizuho Financial Group was up 1.5% while Mitsubishi UFJ Financial was up 2.2% and Sumitomo Mitsui Financial was 1.9% higher. Shares of the major banks in Sydney were 1.8% to 2.2% higher.
However, most bank stocks in Korea were falling, likely due to profit-taking after broad gains Friday. The South Korean government said Monday that the new Basel standards will have a minimal impact on domestic banks. Shinhan Financial and Woori Finance were both 1.1% lower.
Shares in Sydney were pushing to their highest levels in around three months, on broad-based buying.
Among resources stocks, BHP Billiton was up 1.8% and Rio Tinto rose 1.5%.
Regional resource stocks were higher after crude oil futures jumped 3% in New York Friday, settling above $76 a barrel for the first time since mid-August. Woodside Petroleum was up 0.9% and Origin Energy was 1.0% higher in Sydney, in Tokyo, Japan Petroleum was up 1.3% and Inpex added 2.5%. SK Energy gained 2.5% in Seoul while Cnooc gained 2.3% in Hong Kong.
October Nymex crude oil futures were up 70 cents at $77.15 U.S. per barrel on Globex.
Foreigners were net buyers in the Korean stock market, particularly snapping up blue-chip stocks, with Samsung Electronics up 0.7%, Hyundai Motor 2.0% higher and Posco adding 2.9%.
In foreign exchange markets an improved appetite for risk was helping the euro, commodity-related currencies such as the Australian and New Zealand dollars and emerging market currencies.
The euro was at $1.2793 against the U.S. dollar, from $1.2712 U.S. in New York Friday, and at Y107.57 against the yen, from Y107.03. The dollar was at Y84.07, from Y84.21.
CHINA
The data from China on Saturday showed a stronger-than-expected 13.9% on-year rise in August industrial production, from July's 13.4% gain, while retail sales rose 18.4% from a year earlier, picking up from July's 17.9% increase.
Shanghai’s CSI 300 Index improved 29.76 points, or 1%, to 2,962.32
The August inflation rate was 3.5%, in line with market expectations and easing worries among some investors that authorities might tighten monetary policy to curb prices.
Banks were under pressure after the China Business News, citing an unnamed source, reported that China's banking regulator plans to require banks to put aside the equivalent of 2.5% of their outstanding loans as reserves next year as part of efforts to strengthen their balance sheets.
The China Banking Regulatory Commission has no such requirement at present.
China Oilfield Services was up 1.4% while ICBC was flat and China Construction Bank was up just 0.2%.
Elsewhere;
Singapore’s Straits Times Index gained 44.53 points or 1.5%, to return from holiday at 3,066.81
Korea’s Kospi index added 16.28 points, or 0.9%, to 1,818.80
Taiwan’s Taiex Index ballooned 201.39 points, or 2.6%, to 8.091.30
New Zealand’s NZX index moved 17.47 points, or 0.6%, higher to 3,178.47
Australia’s S&P/ASX 200 regained 54.60 points, or 1.2%, to 4,614.90
