Renewed Investor Confidence Sends Asian Shares Higher
Shares in Asia gained Monday. Japan's Nikkei 225 Index rose 1.8% to end the day at 9,880 and Hong Kong's Hang Seng Index advanced 0.9% to close at 20,052. In China the Shanghai Stock exchange was closed in honor of the Dragon Boat Festival.
Signs that business conditions have improved in Japan over the past three months gave investors the confidence to plow cash into manufacturers today. The market was also pushed higher by reports that U.S. consumer sentiment is poised to rise.
Japanese car companies performed well with Honda, which depends on the U.S. for more than 40% of its revenue, surging 4%. Honda shareholders were relieved to hear that workers at one of its parts factories in China agreed to end a strike over higher wages. But according to Bloomberg, the details of the final agreement were not disclosed. Isuzu soared 4.2%, Mazda rose 2.3% and Toyota advanced 1.2%. Hino Motors, a provider of buses and trucks rallied 3.6%.
Japanese real estate companies got a boost today after an analyst at Credit Suisse said the office space and condo markets will improve. Tokyu Land leaped 5.2%, Daiwa House Industry gained 3.1% and Mitubishi Estate added 2.2%.
Tech-based companies gained after forecasting gains this year. Cybozu Inc. skyrocketed 16% after reporting its cost had been lower than expected and Software Service Inc., a creator of medical software, skyrocketed 12.7%. FreeBit Co. wasn't so lucky: the Internet service provider's shares sank 12.2%. Electronics companies also gained ground with Panasonic surging 3.2% and Sony rising 1.8%.
Mercian Corp. plunged 9.3% today after admitting they are investigating "improper" business transactions, according to Bloomberg BusinessWeek. The company makes and distributes traditional Japanese fruit wines as well as medical chemicals from antibiotics to solvents. Beer maker Asahi Breweries, meanwhile, climbed 2.4%.
Hong Kong-listed exporters were looking good today. Esprit, which makes nearly all of its income abroad rallied 3% and Yue Yuen, the maker of millions of sports shoes for the likes of Nike, Adidas and Puma, advanced 1.3%.
Hong Kong-listed car companies rose after China extended perks for trading in older vehicles. Geely, the new owner of Volvo, surged 5.3%. The company also makes a Rolls-Royce look-alike, popular with China's nouveau riche. Great Wall Motors, which makes sporty pick ups and SUVs, climbed 8.8% and DongFeng leaped 6.8%.
Commodity producers closed higher today with Chalco, officially named Aluminum Corp. of China, rising 2.8% and Jiangxi Copper adding 1.2%. PetroChina rose 1.4% and oil exploration company Cnooc advanced 1.2%. Perhaps dragon boat teams have been stuffing extra paper money into the mouths of their dragon heads at the bow of their boats to bring today's good fortune.