U.S. Retail Data Props Up Asian Markets

Most Asian stock markets advanced Friday. In Japan the Nikkei 225 Index rose 0.6% to 9,114 and in Hong Kong the Hang Seng edged up 0.5% to 20,972. China's Shanghai Composite Index slid 0.4% to end the day at 2,655.

Improved sales numbers at major U.S. retailers gave a boost to Asian exporters of consumer goods. Of course this data looked particularly good thanks to tax-free holidays in selected states, including Connecticut, Florida and Texas. And tax- free purchases didn't just apply to back-to-school supplies like pencils and notebooks, they also included big-ticket items like televisions and computers. Stores like Best Buy (BBY) reported wall-to-wall shoppers. "People really come out when there's a tax-free weekend," one Best Buy manager in Massachusetts told allbusiness.com.

Grateful for a respite from the recent downward trend, investors poured money into Japanese electronics makers, most of which benefited from a sales boost during the tax-free periods. Sony reaped a 2.4% gain today, Sharp surged 1.6%, Canon gained 1.3% and Casio added 1.1%. Sound equipment maker, Pioneer, advanced 2.5% while car audio expert, Clarion, rose 2.5%. Exporters were also helped by a slight, but welcome, fall in the value of the yen.

Alps Electric, which specializes in automobile electronics scored a 4.8% gain and car companies were also on the rise. Mazda shot up 2.2%, Toyota climbed 2.1% and Mitsubishi Motor increased 0.9%. Fuji Heavy Industries, which applies technology from its aircraft business to the production of its super-reliable Subarus, advanced 1.5%.

While sales at U.S. clothing retailers, including the Limited, Victoria's Secret and Kohl's, soared in August, according to Bloomberg, Hong Kong-listed retailers closed lower today. China Resources Enterprises, with retail businesses from textiles to food and beverages, sank 1.4% and Li & Fung, a major supplier to many major U.S. chains, inched down 0.1%. Esprit suffered the biggest loss, diving 5.4% after reporting an 11% fall in annual profits. Bloomberg reports that plans are in the works to open shops in 400 Chinese Mainland cities to counteract a slump in sales in the West.

Also in Hong Kong, Ping An, an insurance company supplying policies in China, and also providing financial services, rocketed up 5.5% while some property developers also gained. Wharf Holdings, the operator of some of Hong Kong's biggest shopping malls -- including Harbor City, which is directly accessible from the pier of the company's famous Star Ferry -- advanced 2%. Sino Land rose 3.2% and Henderson Land added 1.1%.

In China it was a good day for the satelilte navigation industry. The People's Republic launched a fifth navigation satellite into orbit last month as part of a plan to conceive a new global navigation service -- a competitor to the U.S.'s Global Positioning System, according to Xinhua. Shares in Beijing BDStar Navigation surged 10% and China Dongfanghong Spacesat skyrocketed 5%. Chengdu Goldtel Electronical Technology, a maker of navigation equipment components, rose 6.9%.

Chinese automakers also rose with FAW Car motoring up 4%, Chongqing Changan Automobile climbing 2.5% and SAIC advancing 1.1%.

But property developers counteracted these gains in China. Gemdale slid 1.2% and Poly Real Estate slipped 0.5%, with analysts expecting the Chinese government to engineer a housing price correction -- far preferable to the bursting bubble many spectators are predicting.

Learn about investing from the comfort of your own home.

Portfolio Basics

Take the first steps to building your portfolio.

View Course »

Investment Strategies

Learn the strategies you need to build a winning portfolio

View Course »

Add a Comment

*0 / 3000 Character Maximum