SINGAPORE (Thomson Financial) - Asian stocks rose Monday with Taiwan leading
the advance with a 4 percent rally following the landslide presidential election
victory for the opposition Kuomintang's Ma Ying-jeou at the weekend.
Ma has vowed to increase trade and business ties with China and revitalise
domestic demand.
The Taiex was last up 4 percent at 8,866.75, led by construction, financial
and transport stocks.
Goldman Sachs said the opposition victory should be good for stocks, " given
their more market-friendly stance on cross-strait policies, and a lower
likelihood of an escalation in cross-strait tensions going forward.
"Over the longer term, we believe the possible breakthroughs in
cross-straits policies could lift potential growth via productivity gains and
investments," said analyst Enoch Fung.
Fung is forecasting Taiwanese GDP growth of 3.8 percent for 2008, followed
by 4.6 percent in 2009.
Other markets posted more modest gains. The blue-chip Nikkei 225 Stock Index
ended the morning session up 46.33 points or 0.4 percent at 12,528.90, boosted
by a pullback in the yen.
The broader Topix index rose 8.42 points or 0.7 percent to 1,228.46.
Before the opening bell, the government announced that sentiment among
large Japanese companies deteriorated in the first quarter, reflecting growing
concern about profits amid higher procurement costs and increased uncertainty
about demand at home and abroad.
"While weak business sentiment dampened the market, investors were relieved
that concern [about the US economy] is less pessimistic than before," said
Hiroichi Nishi, equity chief at Nikko Cordial Securities.
Elsewhere, the Singapore Straits Times was up 2.0 percent at 2,882.38, with
gains fueled by a retreat in commodity prices. New York's benchmark oil futures
contract fell 1.41 dollars to 100.43 dollars per barrel in early Asian trading,
while gold was flat at 912 dollars an ounce.
The South Korean Kospi was last up 0.4 percent at 1,652.71 and the Malaysian
KLSE Composite was up 0.6 percent at 1,195.96.
But the Shanghai Composite bucked the trend, shedding 70 points, or 1.8
percent, to 3,726.651 as investors locked in recent gains.
Markets in Hong Kong and Australia remained closed for the Easter holiday.
The US market was closed on Friday but investors are hoping the major
indexes can build on last week's gains when trading reopens later today for the
final week of the first quarter.
Among individual stocks, Toyota Motor gained 2.1 percent to 5,330 yen. The
Nikkei said Japan's largest automaker is planning to build its fifth engine
factory in the country around 2010 at a cost of about 20-30 billion yen.
Other automakers were also higher as the yen pulled back slightly, boosting
hopes for export earnings. Nissan Motor climbed 3.8 percent at 892 and Honda
Motor rose 2.1 percent at 2,935.
Hitachi fell 0.5 percent to 615 yen after the Nikkei reported that the
electronics giant is planning to resume production of automobile turbochargers
by 2010 as it seeks to boost the sales of its automotive parts business
In Taipei, Cathay Financial gained 5.9 percent at 86.70 dollars and
Chinatrust Financial was up 4.3 percent at 31.35.
Taiwan's two big chipmakers gained. Taiwan Semiconductor added 4.6 percent
to 67.80 dollars and United Microelectronics was up 4.1 percent at 19.10.
Airlines were boosted by hopes for direct transport links with the mainland.
China Airlines climbed 3.7 percent to 19.50 and EVA Air rose 4.9 percent to
20.45.
ciara.linnane@thomson.com
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