Asian stocks near 5-year high on back of US rally
Asian stocks closed near a five-year high yesterday, tracking a strong performance in the United States market and buoyed by better-than-expected home sales in the world's largest economy, amid indications that global central bankers will continue implementing easing measures.
Asian stocks closed near a five-year high yesterday, tracking a strong performance in the United States market and buoyed by better-than-expected home sales in the world's largest economy, amid indications that global central bankers will continue implementing easing measures.
The gauge advanced 4.6 per cent last month on speculation that Japan's decision to double its monetary base would boost local asset prices, including equities, and that other major economies would also initiate pro-growth monetary policies to avoid further slowdown.
The Hang Seng Index climbed to its highest level since March 12, adding 0.69 per cent to finish at 22,737.01 points. With that, the local gauge ended April with a 2 per cent gain, after losing 6 per cent for two consecutive months in February and March.
Turnover rose 22 per cent from a day earlier to HK$52.4 billion, but it is still far below this year's average of about HK$69 billion, as the mainland market is closed for a three-day holiday.
"With the A-share market closed, investors have lost a cue and may be swayed by external figures," said Stanley Chik Yiu-fai, the deputy manager for research at Bright Smart Securities. "I won't say there would be a traditional 'sell in May' scenario as valuation is already fairly cheap, but we can't be too optimistic about a sharp rebound as upcoming China data could dampen the market's optimism."
We can't be too optimistic about a sharp rebound as upcoming China data could dampen the market's optimism
Beijing will today report the official April purchasing managers' index, a key indicator of the mainland's factory activity. That will follow last week's HSBC flash PMI, which fell to a two-month low of 50.5 from 51.6 in March. A reading above 50 indicates expansion of the economy and a reading below contraction.
Coal producers, which have performed poorly this year because of concerns over a slowing mainland economy, rose on cheap valuation support. China Shenhua added 2.23 per cent to finish at HK$27.45 while China Coal Energy rose 1.02 per cent to HK$5.97.
