- POSTED: 09 Dec 2013 16:49
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Asian markets mostly rose on Monday and the dollar edged higher against the yen as Wall Street rallied in response to a surprisingly sharp fall in the US jobless rate.
HONG KONG: Asian markets mostly rose on Monday and the dollar edged higher against the yen as Wall Street rallied in response to a surprisingly sharp fall in the US jobless rate.
Japanese shares enjoyed healthy gains despite the government's downgrade of third-quarter growth, which has raised questions about the strength of a recovery fuelled by government spending.
Tokyo jumped 2.29 per cent, or 350.35 points, to 15,650.21 and Seoul climbed 1.01 per cent, or 19.97 points, to 2,000.38. But Sydney fell 0.80 per cent, or 41.6 points, to 5,144.4.
Shanghai was flat, edging 1.09 points higher to end at 2,238.20 and Hong Kong added 0.29 per cent, or 68.07 points, to close at 23,811.17.
The Sensex in Mumbai rose 1.00 per cent to a record high after the main opposition Bharatiya Janata Party, widely seen as business-friendly, recorded a string of victories in state elections.
In other markets, Taipei rose 0.92 per cent, or 76.90 points, to 8,444.62, while Manila slipped 0.10 per cent, or 6.00 points, to close at 6,008.94.
Traders took their cue from New York, where the three main indexes posted solid gains on Friday after the Labor Department said the jobless rate dropped to a five-year low of 7.0 per cent in November, from 7.3 per cent in October.
It also said the economy added a healthy 203,000 jobs.
The upbeat data increase the chances that the Federal Reserve will begin to wind down its stimulus programme sooner rather than later.
Fears of a reduction in the Fed's US$85 billion a month bond-buying scheme -- which has been credited with fuelling an equities rally in world markets -- pushed down stocks last week.
However, analysts said it may hold off any taper at its December meeting because the pace of jobs growth is still below the levels seen at the start of the year, while economic growth in October-December is expected to be sluggish.
They forecast that the central bank will wait to see whether the jobs figures can be sustained over another month.
The Dow surged 1.26 per cent, the S&P 500 added 1.12 per cent and the Nasdaq jumped 0.73 per cent on Friday.
"The correction stage of the US shares prior to the employment data release is over and there is greater optimism in the market, buoyed by the reaction to the strong employment figures," Mitsushige Akino, fund manager at Ichiyoshi Asset Management, told Dow Jones Newswires.
On forex markets, the dollar climbed against the yen since an end to the stimulus would mean fewer dollars circulating in financial markets, pushing up demand.
The dollar bought 103.05 yen Monday compared with 102.85 on Friday in New York.
The euro fetched 141.15 yen, levels not seen since October 2008, compared with 141.03 yen on Friday. It stood at US$1.3699 against US$1.3705.
The euro was supported by the European Central Bank's decision last week to delay any new interest rate cuts despite prolonged low inflation.
Japan said on Monday that economic growth in the three months to September slowed to 0.3 per cent quarter-on-quarter, less than the 0.5 per cent initially stated and well down from the 0.9 per cent in the previous three months.
While analysts tipped a pick-up in pace in October-December, they remain divided over whether stimulus policies -- which stoked impressive increases earlier in the year -- will cement lasting growth.
Shanghai ended flat despite official figures on Sunday showing a bigger-than-expected trade surplus of US$31.1 billion in October.
In India, dealers cheered the BJP's election success, which raised hopes it could come to power with decisive strength in a general election in May and introduce pro-market reforms to boost the ailing economy.
The rupee also strengthened to 60.84 to the dollar at one point, its strongest since August before easing slightly to 61.15. It had closed on Friday at 61.42.
On oil markets, New York's main contract, West Texas Intermediate for January delivery, was up seven cents at US$97.72 a barrel in afternoon trade. Brent North Sea crude for January fell nine cents to US$111.52.
Gold fetched US$1,231.07 per ounce at 0805 GMT compared with US$1,229.14 on Friday.