Asian markets rose Tuesday following better-than-expected manufacturing data from the United States that lifted hopes for recovery in the world’s number one economy.
The news, which followed minor improvements in Asian and European activity, also gave a boost to the dollar and euro against the yen, lifting Japanese stocks. Tokyo was 0.25 percent higher by the break, Sydney added
0.60 percent and Seoul was 0.27 percent higher, while Taipei added 0.26 percent. Hong Kong, Shanghai and Mumbai were closed for a public holiday.
Traders took their lead from Wall Street, which ended broadly higher after the Institute for Supply Management said its Purchasing Managers Index (PMI) edged up to 51.5 last month, from 49.6 in August — representing the first expansion after three months of contraction.
A reading above 50 indicates growth and anything below represents shrinkage.
On Monday China said its own PMI was at 49.8 in September, which while still negative represents a modest improvement on 49.2 in August. And in Europe the reading came in at 46.1, up from 45.1.
CLSA equity strategist Nicholas Smith said that the figures appeared to show “that the general picture is for a turnaround in global markets”. At the close of trade on Wall Street the Dow added 0.58 percent and the S&P 500 added 0.27 percent but the Nasdaq edged down 0.09 percent.
On currency markets the dollar stood at 78.13 yen in Asian trade, from 77.98 yen in New York late Monday.
The euro was at $1.2898 and 100.82 yen, compared with $1.2887 and 100.51 yen in New York. Eyes are now on the Reserve Bank of Australia (RBA), which is due later in the day to announce a decision on interest rates, with opinion split on whether it will make a cut to boost the economy.
“A rate cut today looks like a line ball decision for the RBA,” Ric Spooner, Chief Market Analyst at CMC Markets said in a note to clients. “With a division of opinion amongst analysts on whether the
RBA will move, a rate cut today has the potential to move markets this afternoon,” he said, according to Dow Jones Newswires.
Oil prices rose in early trade, with New York’s main contract, light sweet crude for delivery in November, adding three cents to $92.51 a barrel and Brent North Sea crude for November gaining 16 cents to $112.35. Gold was at $1,777.30 at 0300 GMT compared with $1,770.50 on Monday.
