U.S. Shoppers Drive Asian Shares Higher, Unsexy Cement Hot Commodity in China
Hong Kong retailers surged ahead today as analysts awaited glowing U.S. retail sales data. If U.S. spending really did kick into gear in November, it would be the fifth straight month of gains. Good news for the economy, but perplexing considering the 9.8% unemployment rate.
Meanwhile retail sales in Asia look even rosier, with some saying they could far outpace those in the U.S. in the next four years. In fact, one PwC report predicts that Asian sales figures could be double those of America by 2014 and expects growth of 6% a year on average. "Demand is growing across the board, from inexpensive fast-moving consumer goods to exclusive luxury items," said the director of the Economist Intelligence Unit. Asian retail sales are expected to total about $2.2 trillion for 2010, and could climb to $4.6 trillion by 2014. That's a lot of Louis Vuitton handbags and Bossini t-shirts.
Companies dealing in the coal that still powers the majority of China's factories, and contributes to the pollution-tinged skies, saw gains today. China Shenhua, which provides energy and transports the black stuff around the country using its dedicated rail lines and ports, zipped up 3.8% and China Coal jumped 2.9%.
Other commodities firms also climbed with oil company Cnooc gaining 0.8% and PetroChina advancing 0.6%. Among miners, Real Gold Mining leaped 3.9%, Aluminum Corp. of China rose 1.3% and Zijin Mining added 1%.
China's Building Plans Boost Demand for Cement
In China investors bet money on cement companies after word spread that the government plans to build 10 million low-cost apartments over the next year. That's 72% more than the number constructed this year, according to Xinhua, and that means more of those slab buildings emerging from shrouds of bamboo scaffolding in many Chinese cities. Today Fujian Cement and Jiangxi Wannianqing Cement both hit the 10% daily limit.
Agricultural companies reaped gains thanks to the record inflation that's allowing massive price hikes for food and other necessities. Yuan Longping High-tech Agricultural surged 10% and Shandong Denghai Seeds soared 7.3%.
In Japan, brokerages headed north again on hopes that tax breaks will remain in place. The government is surely loathe to do anything that could slow down the crawling recovery. Today Mizuho Securities shot up 4.1%, Daiwa Securities surged 2.9%, Nomura climbed 1.5% and Mitsubishi UFJ added 0.5%.
Other big gainers on Tokyo's big board included a 4.3 rise in chemical company Nippon Kayaku, maker of products ranging from pharmaceuticals to explosives, a 4.1% surge in Fujitsu, the communication and semiconductor equipment company, and a 3.6% advance in Olympus shares.