Asian Stocks Gain on Robust China Trade Data
By Prasanth Aby Thomas | February 8, 2013 3:22 PM EST
Most Asian markets gained in the morning after China's trade data for January reinforced the country's growth prospects.
Japan's benchmark Nikkei average index fell 1.38 percent or 156.63 points to 11200.44 while South Korea's KOSPI was up 0.80 percent or 15.38 points to 1947.15. Australia's S&P/ASX added 0.56 percent or 27.50 points to 4963.20.
At its policy meet, the ECB kept its interest rates unchanged at 0.75 percent. The bank's president Mario Draghi said that the region could recover moderately this year, but added that the negative risks outweigh the positive ones. He also mentioned that ECB will keep a close watch on the single currency's strength, adding to speculation that a firm euro could pave way for further interest rate cut decisions.
"What really got the currency markets moving was his opinion regarding the prospect of ECB intervention: 'we are probably not too far away from the point where the ECB would see itself forced to react'," said Jason Hughes, head of premium client management at IG Markets.
"These comments caused concern among traders that the euro had risen too high, too fast and could lead to problems across a region still battling with a three-year old federal debt crisis. This signalled that the ECB would be prepared to take some form of action if it decided that the valuation of its currency was damaging the region".
However, Asian trading sentiments received a strong boost after China's official trade figures showed that the world's second-largest-economy's exports and imports accelerated beyond expectations in January. Outbound shipments climbed 25 percent year-on-year from the 14.1 percent reported in the previous month. Imports rose 28.8 percent, a sharp jump from the previous 6 percent.
Traders are now awaiting China's inflation data scheduled for release later in the day.
The Reserve Bank of Australia slashed its growth forecasts as economic activities outside the mining sector remains weak and the local currency remains firm. The central bank estimates growth to remain at 2.5 percent in 2013, downgrading its prediction of 2.75 percent made earlier.
Electronics plunged in Tokyo. Shares of Sony were down 8.95 percent after the company posted losses for the eighth consecutive quarter and slashed its sales targets. Pioneer was down 7.23 percent.
Property stocks traded higher in Hong Kong. China Overseas Land and Investment gained 2.28 percent while China Resources Land added 2.13 percent.
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