Asian markets mostly get rise on stimulus hopes
By Danny McCord, AFPHONG KONG -- Asian markets mostly rose Monday after more weak Chinese manufacturing data fuelled hopes for a fresh round of monetary easing by Beijing.
September 4, 2012, 12:09 am TWN
The downbeat figures out of China added to expectations of more stimulus measures in the United States following strong hints from Federal Reserve chief Ben Bernanke on Friday.
Hong Kong added 0.39 percent, or 76.64 points, to 19,559.21 and Shanghai ended 0.57 percent higher, adding 11.63 points to 2,059.15, while Sydney gained 0.31 percent, or 13.6 points, to end at 4,329.7.
Seoul put on 0.40 percent, or 7.59 points, to 1,912.71 but Tokyo slipped 0.63 percent, or 56.02 points, to 8,783.89.
Fears over growth in China were stoked again on Saturday when the official Purchasing Managers' Index (PMI) of manufacturing activity fell to a nine-month low of 49.2 in August from 50.1 in July, owing to slumping demand in the key export markets of Europe and the United States.
A reading above 50 indicates expansion, while one below 50 points to contraction.
And on Monday a PMI reading from HSBC showed August activity fell to its lowest level since March 2009.
The final reading of the British banking giant's index slid to 47.6 from 49.3 in July.
The results add to rising concerns over China's economic growth and come despite Beijing cutting interest rates and lowering the amount of cash banks must keep in reserve as it looks to boost activity.
China's economy grew just 7.6 percent in the three months to June, the worst performance in three years and the sixth straight slowdown, while figures for trade, industrial output and retail sales in July were also weak.
The latest results will boost expectations of another cut to banks' reserve requirements or even interest rates.
“The pace of growth has slowed much more than the authorities (in Beijing) expected,” Stephen Halmarick, head of investment markets research at First State Investments, told Dow Jones Newswires.
Global markets posted gains at the start of last month as dealers bet that central banks in China, Europe and the United States would announce fresh stimulus and easing policies, but the lack of action has led to selling pressure in the past few weeks.
In the United States, Bernanke on Friday told central bankers that stagnation in the labor market was “a grave concern” and signaled he would be pushing for more help for the economy.