22/07/2015 06:09 AST
Asian markets advanced on Tuesday, with Tokyo boosted by a weaker yen and Shanghai’s recovery continuing, but falling commodity prices fuelled fears about global growth.
With concerns easing about the Greek debts crisis and Chinese market rout, dealers are now focusing on when the US Federal Reserve will hike interest rates as the US economy gets back on track.
Tokyo rose 0.93 per cent, or 191.05 points, to 20,841.97 — close to an 18-year high — and Sydney climbed for a sixth straight session, putting on 0.35 per cent, or 19.8 points, to 5,706.7. Seoul gained 0.50 per cent, or 10.31 points, to 2,083.62.
In afternoon trade Shanghai was 0.99 per cent higher, breaking the key 4,000 point barrier, and Hong Kong added 0.70 per cent.
Buying was also supported by another positive lead from Wall Street, where the Nasdaq ended at a record high for the third straight session, adding 0.17 per cent.
The Dow gained 0.08 per cent and the S&P 500 finishing up 0.08 per cent higher, just short of an all-time high.
Gold suffers: Chinese shares have risen more than 14 per cent since hitting a July 8 low, forcing Beijing to introduce a raft of measures to staunch a month-long plunge that saw the Shanghai index fall by about a third, wiping trillions off valuations.
Among the measures were a police crackdown on short-selling and a ban on big shareholders and company executives from selling stock for six months, adding to earlier announcements.
“The 4,000 level is a key battlefield for bulls and bears,” Li Jingyuan, general manager of the securities investment department at Shanghai Zhaoyi Asset Management, said. He added that once the level is breached traders feel more confident to carry on buying.
However, dealers said there are fears that a slip in commodities prices underlines weakness in the global economy.
Gold fetched $1,104.04 an ounce after falling as low as $1,072 on Monday, its weakest since 2010. The precious metal had been at $1,144.00 late on Friday but has taken a hit owing to the US rate hike talk, which has seen investors rush into the dollar looking for better returns.
And on oil markets US benchmark West Texas Intermediate for August delivery fell 20 cents to $49.95 a barrel while Brent crude for September dropped 14 cents to $56.51 in afternoon trade.
“This commodities rout is a very big concern,” Michael McCarthy, a chief strategist at CMC Markets in Sydney, told Bloomberg News.
“There’s risk for a further downside. It looks like the overall global growth outlook is continuing to slow.”
Investors were also keeping an eye on Greece where the government hiked taxes and paid billions of euros to its creditors on Monday, as banks reopened just days after the debt-laden country reached a bailout deal with its creditors.
In other markets:
— Taipei gained 0.34 per cent, or 30.96 points, to 9,005.96.
Taiwan Semiconductor Manufacturing Co. rose 1.08 per cent to Tw$ 140.5 while MediaTek gained 3.03 per cent to Tw$ 357.0.
— Wellington added 0.26 per cent, or 14.98 points, to 5,876.91.
Spark was up 1.03 per cent at NZ$ 2.935 while Warehouse Group was steady at NZ$ 2.61.
AFP
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