www.bloomberg.com FUTURES VALUE CHANGE % CHANGE Nikkei 225 17,770.00 230.00 1.31 Topix 1,742.50 21.00 1.22 Hang Seng 20,920.00 566.00 2.78 Singapore Straits Times 3,445.00 -22.00 -0.63 S&P/ASX 6,373.00 69.00 1.09 I wonder if investors will increase ASIAN exposure and take profits in US indices?
Asian Stocks Rise to Record; China Mobile Leads Hong Kong Surge By Chen Shiyin and Darren Boey May 14 (Bloomberg) -- Asian stocks rose to a record, led by Hong Kong after China's government said it will let its banks buy shares overseas for the first time. China Mobile Ltd. led Hong Kong's Hang Seng Index to a new high on speculation the city's Chinese listings will attract some of the 35 trillion yuan ($4.6 trillion) of savings in China, where markets have almost tripled in the past year making them the region's most expensive. All 10 industry groups on the Morgan Stanley Capital International Asia-Pacific Index advanced. ``This is all part of the positive China story,'' Geoff Lewis, head of investment services at JF Asset Management Ltd. in Hong Kong, which manages $88 billion in Asia. ``Good sentiment towards China is good for Hong Kong also. The two markets are becoming more and more interlinked so you can't really count them as separate markets any more.'' Toyota Motor Corp. climbed by the most in two months, leading gains among exporters after a report showed easing U.S. inflation. BHP Billiton Ltd, the world's largest mining company, followed a gain in prices of metals including copper and zinc. The MSCI Index added 1.3 percent to 150.35 at 12:29 p.m. in Tokyo, ending a two-day, 1.1 percent slide. The measure is set to exceed its May 9 record of 150.12. Benchmarks gained in all markets open for trading, with the Hang Seng surging 2.4 percent. In Japan, the Nikkei 225 Stock Average added 1.1 percent to 17,740.74. Sumitomo Mitsui Financial Group Inc., the country's No. 3 lender by assets, gained to a four-week high after the Nikkei newspaper said the company may increase its dividend. South Korea's Kospi index climbed to its fourth consecutive record after Woori Investment & Securities Co. raised its recommendation on shares of Kookmin Bank. U.S. stocks rose on May 11, enabling the Dow Jones Industrial Average and Standard & Poor's 500 Index to jump the most this month. Beneficiaries China Mobile, the world's largest mobile-phone operator by users, gained 3.5 percent to HK$73.40. China Life Insurance Co., the nation's biggest insurer, jumped 4.3 percent to HK$25.65. Commercial banks can invest as much as 50 percent of funds in the qualified domestic institutional investors program, or QDII, in overseas stock markets, the China Banking Regulatory Commission said on May 11. Investors need at least 300,000 yuan ($39,000) to buy such financial products, the regulator said. China shares are Asia's best performers this year, after an 82 percent jump in the CSI 300 Index. The market is also the most expensive in the region, with the benchmark valued at about 42 times earnings. Meanwhile, the Hang Seng China Enterprises Index, which tracks the so-called H shares of 41 mainland companies, has added 4.5 percent. It's valued at about 20 times earnings. ``The move will create arbitrage opportunities by allowing mainland investors to buy cheaper H shares,'' said Thue Isen, who helps manage $1 billion in Asian equities at Bankinvest Group in Singapore. `Tapering' Inflation Toyota, the world's largest automaker by market value, added 2.9 percent to 7,360 yen. Hon Hai Precision Industry Co., the world's largest contract-electronics manufacturer, gained 1.3 percent to NT$241.50. U.S. producer prices excluding food and fuel costs were unchanged for a second month in April, government reports showed on May 11. Federal Reserve policy makers on May 9 left their benchmark lending rate at 5.25 percent and said rising prices remain the main risk. ``The numbers suggest inflation might be tapering and raises the possibility the Fed may cut rates, which would lower borrowing costs,'' said James Chua, who helps manage about $200 million at Phillip Capital Management in Singapore. Nissan Motor Corp., Japan's third-largest automaker by sales, surged 4.4 percent to 1,290 yen. Nissan also advanced after Nomura Securities Co. raised its rating to ``buy'' from ``neutral.'' Metals, Banks BHP, the world's largest mining company, climbed 1.7 percent to A$31.51. Rio Tinto Group, the third biggest, rose 1.6 percent to A$93.50. Sumitomo Metal Mining Co., Japan's biggest nickel producer, jumped 2.2 percent to 3,000 yen. A measure of six metals traded on the London Metal Exchange, including copper and zinc, rose 0.7 percent on May 11. ``The resources shares are always among the favorites, and those companies that can justify their share prices because of earnings,'' said Jamie Spiteri, head dealer at Shaw Stockbroking Ltd. in Sydney. Sumitomo Mitsui, Japan's third-largest bank by assets, added 0.9 percent to 1.11 million yen. Mitsubishi UFJ Financial Group Inc., the nation's biggest, advanced 1.5 percent to 1.36 million yen. Mizuho Financial Group Inc., the No. 2, rose 1.4 percent to 782,000 yen. Sumitomo Mitsui may raise its annual dividend by 3,000 yen a share to 10,000 yen, the Nikkei reported. The newspaper said other banks including Mitsubishi UFJ and Mizuho may also increase their payouts. All three are scheduled to report earnings next week. Earnings Kookmin, South Korea's biggest bank, gained 1.8 percent to 83,700 won. Woori Investment lifted its recommendation on Kookmin to ``buy'' from ``hold,'' in a report today, citing cheap valuations. Woori's 12-month share-price estimate was raised by 7.8 percent to 95,500 won. The price is low enough for investors to try a ``buy and hold'' approach, wrote Daniel Baek, an analyst. Shinhan Financial Group Ltd., South Korea's second-largest lender, advanced 1.7 percent to 54,300 won. Tokyo Electron Ltd., the world's second-largest supplier of chip-making equipment, jumped 5 percent to 8,660 yen. Net income will probably rise 14 percent to 104 billion yen ($865 million) in the year ending March 2008, and sales may gain 5.6 percent to 900 billion yen, the company said May 11, on demand for memory chips used in computers and handsets. The forecasts beat average estimates compiled by Bloomberg News. `Insatiable Demand' Singapore Airlines Ltd., the world's largest carrier by market-value, added 3.2 percent to S$19.10. Fourth-quarter profit more than doubled from a year earlier to S$671.3 million ($443 million) as fleet expansion and Asia's economic growth boosted passenger numbers. Earnings beat the S$549 million median estimate in a Bloomberg survey of six analysts. The airline said it plans to pay a dividend of 85 cents a share and cancel one stock for every 15 held. ``There's an almost insatiable demand for growth and investors have been shifting towards those stocks,'' said Leslie Phang, who manages about $1 billion at Commonwealth Private Bank in Singapore. Eisai Co., Japan's fourth-largest drugmaker, jumped 11 percent to 6,130 yen, set for its biggest gain in six years. A U.S. court said May 11 after markets closed in Japan that the patent on stomach ulcer drug Aciphex, Eisai's second-best selling product, was enforceable and infringed by Dr. Reddy's Laboratories Ltd. and Teva Pharmaceutical Industries Ltd. To contact the reporter for this story: Chen Shiyin in Singapore at schen37@bloomberg.net ; Darren Boey in Hong Kong at dboey@bloomberg.net Last Updated: May 13, 2007 23:36 EDT
Singapore and Hong Kong have about 40% more uproom which will be achieved in about 6-7 months. Shanghai has about 50% more room upwards too. I would be looking for weakness around September/October time-frame. The summer will be fun and there will be a global breakout. There are a few notable levels to watch for volatility. Once the RUT gets over the rim then we will be just fine. All the other indexes are way over the rim and in breakout mode. Now we just need domestic small-caps to follow the lead and its all up from here. I would be worried of the Shanghai at the 4200, 5000, 6000 and 7000 levels.
bears have to shut up now but there day will come soon. this will lead to a huge panic out by july or august. man the whole world is acting like 99 again. its all fiat borrowed money.
the bulls have to worry, with a global boom and nearly EVERYONE predicting 50-100% increases in equities on top of the 300-500% returns in only the last 5 years you just have to worry about how much longer can this last. I think the longer it lasts the more severe of a correction is possible, I think 30 to as much as a 50% decline in the next bear market. Again it will not be fun....
I think the asian markets along with the US and emerging markets easily see a 5% correction before Sept/Oct.