Asian equity markets trade with gains as upbeat sentiment rolls over from the US, where equities finished positive as markets factored in the possibility of delayed Fed tapering, as the lower revision in Q1 GDP pointed to weaker economic growth. The ASX 200 traded higher from the open led by the consumer services and telecoms sectors. In terms of news, Kevin Rudd was sworn in as Australian PM after defeating former PM Gillard 57-45 in yesterday’s Labor leadership ballot and opposition leader Abbot refrained from moving for a no-confidence motion. The Nikkei 225 traded with firm gains as the telecoms sector outperformed, which was supported by gains in Softbank shares after Dish Network announced a withdrawal of their Clearwire tender offer. The Hang Seng and Shanghai Comp. both trade with decent gains as the liquidity situation in China stabilized with the 1-day repo rate trading flat at 5.5734%. The KOSPI is the best performing index, amid a better than previous South Korean Current Account Balance of USD 8638.8mln vs. USD 3972.2mln and the government revising their 2013 GDP growth forecast to 2.7% from 2.3%.
In the FX markets, USD weakened following yesterday’s poor US GDP revision which is benefiting most majors against USD. Elsewhere, NZD was pressured after the release of lower than expected New Zealand Trade Balance of 71mln vs. 427mln. NZD was further weighed after RBNZ deputy governor Spencer commented that a rate increase is not the right policy at this time and that the overheated housing market is a threat to financial stability. However, the decline seen in NZD/USD soon reversed as USD weakness took effect.
Looking forward, Japanese All Industry Activity Index is scheduled for release at 0530BST/2330CDT.
As of 0348BST:
ASX 200 (+1.83%), Nikkei 225 (+1.92%), Hang Seng (+1.60%), KOSPI (+2.96%), Shanghai Comp. (+1.38%)
26 Jun 2013 - 21:49 - - Source: RANsquawk
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