CANBERA (dpa-AFX) - Asian shares snapped a three-day losing streak on Friday, as a successful Spanish bond auction and signs of strength in the world's largest economy helped investors overlook the gloomy European developments.
The number of Americans filing new claims for jobless benefits dropped by 19,000 last week to 366,000, the fewest since May 2008, the U.S. Labor Department said on Thursday, raising hopes for the U.S. economy.
The jobs data coupled with data showing a jump in manufacturing activity in mid-Atlantic U.S. states in December helped investors shrug off fresh worries over Europe after Fitch Ratings downgraded six major global banks, citing increased challenges in global financial markets.
International Monetary Fund chief Christine Lagarde warned overnight that the world economic outlook is 'gloomy,' and that no nation, irrespective of their economic status, is immune to the crisis.
Japanese rose modestly, snapping three days of losses, as upbeat U.S. economic data helped offset concerns over squeezing credit conditions for European banks. The Nikkei average rose 0.3 percent and the broader Topix index closed up 0.2 percent.
Domestic-demand driven stocks paced the gains on defensive buying, with Takeda Pharmaceutical, Softbank and Japan Tobacco rising between 1.1 percent and 2.4 percent. Fujifilm Holdings slipped 1.3 percent after saying that it agreed to buy U.S. medical-equipment maker SonoSite Inc. for $995 million.
Scandal-hit Olympus continued to slip, with the stock tumbling 3.6 percent, ahead of a meeting of creditors taking place later in the day. Itochu fell 2.7 percent and Mitsubishi Corp. lost a percent, with the recent sell-off in commodities weighing on the trading firms. Online game developer Nexon slumped 12 percent, extending losses from its disappointing trading debut on Wednesday.
At a policy meeting slated for Tuesday and Wednesday, the Bank of Japan is expected to cut its economic assessment slightly, citing the results of its latest Tankan survey which showed a sharper-than-expected decline in business sentiment among Japan's larger manufacturing companies.
China's Shanghai Composite index rose two percent, ending a six-session losing streak, on speculation that the government will cut lenders' reserve-requirement ratios again in the near term following suspected dollar-selling intervention by state-run banks, who often act on behalf of the central bank. Hong Kong's Hang Seng index closed 1.4 percent higher, with Chinese property developers leading the gainers.
Australian shares posted modest gains, snapping a three-day losing streak, with positive offshore leads helped by encouraging U.S. and German manufacturing PMI data bolstering investor sentiment. Both the benchmark S&P/ASX 200 and the broader All Ordinaries index closed up around half a percent each.
The big banks ended mostly higher despite law firm Maurice Blackburn filing class action proceedings against the other big banks after partial success in the ANZ case. ANZ closed 0.7 percent higher, Commonwealth rose a little over a percent and Westpac added 0.2 percent, but NAB edged down 0.2 percent ANZ Group Chief Executive Mike Smith said he did not see a credit crunch emerging in Australia, at least in the short term.
Among big miners, BHP Billiton edged up 0.4 percent, Rio Tinto advanced 0.7 percent and smaller rival Fortescue rose 1.6 percent. Department-store chain Myer fell 2.6 percent on saying that it will close its Tuggeranong outlet in the Australian Capital territory by May next year at the latest.
JB Hi-Fi plummeted 15.3 percent after the electronics retailer warned its first-half earnings would fall 5 percent. Blue chip Telstra edged up 0.3 percent after the Australian Competition and Consumer Commission invited comments on the company's revised plan to separate its retail and wholesale arms.
South Korea's Kospi average closed 1.2 percent higher, as stronger U.S. jobs data eased concerns about the economic outlook for the American economy. Battered automakers bounced back, with Hyundai Motors rallying 2.5 percent and its affiliate Kia Motors gaining 2.3 percent. Shipyards, sensitive to the economic outlook, gained ground with Hyundai Heavy and Samsung Heavy Industries rising 1-2 percent.
Samsung Electronics, the consumer electronics giant which hired former AOL and Google executive David Eun as its executive vice president, jumped 3 percent. Kolon Industries, the nation's leading textile and chemical material producer, closed 0.7 percent lower on a report that it is recalling 3000 outdoor jackets after excessive level of cancer-causing agents were found on some of them.
New Zealand shares fell on concerns over corporate earnings outlook after Nuplex said it wouldn't meet earnings guidance in the face of slowing global demand. Shares of the specialty chemicals maker plunged over 9 percent, while the benchmark NZX-50 index closed half a percent lower. Carpet maker Cavalier slumped 7.1 percent and construction materials supplier Steel & Tube Holdings lost 6.9 percent.
Sanford rose 2.1 percent after the fishing firm said it reached an agreement to recover its purse seine vessel the San Nikunau from U.S. custody in Pago Pago. Chorus, Telecom's spun off unit, gained 3.1 percent, while Telecom shares ended down 1.5 percent.
India's Sensex was last trading down over two percent, erasing early gains, after the Reserve Bank of India kept key policy rates unchanged, taking into account the inflation situation and also growth moderation. ' We will manage liquidity through market operations (but) I cannot speculate when we might start cutting rates,' governor D Subbarao said.
Elsewhere, Indonesia's Jakarta Composite index was rising 1.8 percent, Singapore's Straits Times gained 0.9 percent and the Taiwan Weighted added 0.3 percent.
On Wall Street, stocks pulled back well off their highs to end modestly higher overnight, with the Nasdaq, S&P 500 and the Dow indexes rising between 0.1 percent and 0.4 percent.
While upbeat economic data on jobless claims and regional manufacturing activity and better-than-expected FedEx's fiscal second-quarter earnings boosted investor sentiment in early trading, continued concerns about the economic outlook for the euro zone helped to limit the upside for the markets.
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© 2011 AFX News
