HONG KONG: Asian stock markets rebound on Friday after decrease in U.S. unemployment applications and comments from a Federal Reserve official eased nerves about a stalling economic recovery.
Hong Kong’s Hang Seng increased 0.2 percent to 22,931.60 and Australia’s S&P/ASX 200 was up 0.4 percent at 5,274. Japan’s Nikkei 225 dropped 1 percent to 14,588.16 as a rise in the yen against the dollar hurt exporter stocks. Markets in Southeast Asia were mostly higher and India’s Sensex added 0.2 percent to 7,811.39. China’s Shanghai Composite sank 1.1 percent to 2,331.38.
“Large daily moves are a good reminder to investors that the superior long term gains in shares are accompanied by higher risk,” said Michael McCarthy, chief market strategist at CMC in Sydney. “This week’s moves have largely ignored data. However, GDP estimates in Europe and housing numbers in the US tonight speak directly to recent market concerns around growth. Next week, the other major economy, China, will report industrial production and retail sales to round out the global picture.”
Remarks from St. Louis Fed President James Bullard helped perk up stocks. In an interview with Bloomberg TV, Bullard said that the Federal Reserve should consider putting off winding down its monthly bond purchases this month as planned. Bullard is not a voting member of the central bank’s policymaking committee, but as the head of a branch of the Fed investors still followed his remarks closely. The Fed’s monthly bond purchases are currently $15 billion. The number of people seeking U.S. unemployment aid dropped to the lowest level in 14 years last week, the latest signal that companies are cutting few workers and hiring could pick up. That reinforced confidence in the U.S. economic recovery at a time when Europe and Japan are struggling.
