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Asian Stocks Climb From $1.1 Trillion Slump on U.S. Data




Many rallies are still pretty much dependent on US data and the same can be sad about forex. Always monitor the equities for clues to risk aversion.

Asian Stocks Rebound From $1.1 Trillion Correction on U.S. Data

Asian stocks rebounded, after the regional benchmark index yesterday erased this year’s gain, as U.S. economic data beat estimates and on bets the Federal Reserve will keep its record stimulus. Japan’s Nikkei 225 Stock Average and the Hang Seng China Enterprises Index of mainland companies listed in Hong Kong rose after entering a bear market yesterday. Kawasaki Heavy Industries Ltd. (7012) rose 3.9 percent in Tokyo after removing its president and ending merger talks with Mitsui Engineering & Shipbuilding Co. (7003) Australian banks paced gains among financial shares. The MSCI Asia Pacific Index rose 1.4 percent to 130.83 as of 11:29 a.m. in Tokyo and is up 0.4 percent this week. The gauge closed yesterday at the lowest since Dec. 27 and dropped more than 10 percent, erasing $1.06 trillion in value, since its 2013 high on May 20, meeting some traders’ definition of a correction. “You get good data plus reduced fear about a premature rate hike from the U.S. Federal Reserve, and that helped the U.S. share market and that’s helping Japanese and Asian markets today,” said Shane Oliver , Sydney-based head of investment strategy at AMP Capital Investors Ltd., which has $126 billion under management. “Look at the underlying global growth dynamics and they remain favorable.” Relative Value The Asia-Pacific measure traded at 12.5 times estimated earnings as of yesterday, compared with 14.8 times for the Standard & Poor’s 500 Index (SPX) and 12.9 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg. The MSCI Asia Pacific excluding Japan lost 11 percent through yesterday from this year’s high on May 9 on concern a pickup in the U.S. economy may prompt the Fed to taper stimulus. The gauge rose 0.7 percent today, paring this week’s drop to 2.2 percent. All 10 industry groups […]

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