Markets enter into a typical pre non-farm period of tranquility
Asian markets witnessed mostly listless trades ahead the non-farm payrolls, as investors were hesitant to enter into the markets on the heels of such a critical data. The economic indicators have improved in Asia and US over the last couple of sessions but the traders seemed reluctant to add to their recent longs given that a sharp downward bias in non farm is good enough to ruin off all the other positive economic endeavors. Moreover, with the US Labor Day holiday on Monday, the participants are not willing to take much of a risk. Select Asian stocks still eked out gains, buoyed by a late surge on Wall Street in the prior session.
US stocks maintained their positive outing yesterday. The US factory orders showed a modest increase in July. A latest report from the Commerce Department stated that orders for manufactured goods edged up by 0.1% in July following a revised 0.6% decrease in June. The modest increase in factory orders in July was largely due to a 12.9% increase in orders for transportation equipment, which reflected a substantial 75.9% increase in orders for commercial aircraft and parts.
Pending sales of existing U.S. houses climbed 5.2 percent in July, figures from the National Association of Realtors showed yesterday. The Standard & Poor's 500 Index increased 0.9 percent yesterday in New York, rounding out its biggest two-day gain since early July.
Japanese stocks gained for a third day, on up tick in US stocks and improved economic outlook. The Nikkei 225 Stock Average added 0.6% to 9,114.13, extending the rebound form lows under 9k mark. The broader Topix index climbed 0.5% to 823.70. The Nikkei had sunk to its lowest level in 16 months in intraday trading two days ago.
Australian stocks added decent gains on global cues and the upbeat undertone in the local sentiments after the recent GDP data showed that economy grew at its fastest quarterly pace in three years on the back of surging household consumption and strong commodity prices. Australian real gross domestic product (GDP) rose by a seasonally adjusted 1.2 per cent in the June quarter, its fastest quarterly growth rate since it touched 1.3 per cent in the June quarter of 2007. The benchmark S&P/ASX200 index closed up 8.5 points, or 0.2 per cent, at 4541.2 today, coming off the early high but still maintaining a steady undertone, while the broader All Ordinaries index added 14.6 points, or 0.3 per cent, to 4577.6.
Chinese stocks ended mixed today on lack of active trading as traders awaited for the key US data. Selling pressure on banking shares and property developers on speculation that the government would announce more tightening measures has also been having an effect on the sentiments after a strong manufacturing data earlier in the week. In listless trades, the benchmark Shanghai Composite Index shed 0.38 points, or 0.01 percent to close at 2,655.39. The Shenzhen Component Index inched up 1.94 points, or 0.02 percent, to end at 11,467.09.
In Mumbai, the key benchmark indices moved between gains and losses after hitting a fresh intraday low in afternoon trade. Inflation for the Primary Articles group rose to 15.19% from 14.75% in the year through 14 August 2010, the data showed. Inflation for the Fuel & Power group also increased to 12.71% from 12.57% in the preceding week, according to the Commerce Ministry data. The BSE SENSEX was last seen quoting at 18255.47, up 17.16 points or 0.09% on the day. Small caps continue to race up with the SMLCAP index up around 1%.
In other markets, the Hang Seng index in Hong Kong added 0.49%, TSEC in Taiwan soared 1.42% while the Strait Times index in Singapore edged up 0.10%. Crude oil topped at $74.97 per barrel today and currently quotes at $74.59, down 43 cents from the previous close. Dollar is mostly up against the Euro, quoting just above 1.2800 as markets enter into a typical pre non-farm period of tranquility.
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