Philippine shares star in Asia; Tokyo
ends up
John Mair
Philippine stocks surged 17 per cent on Monday after the weekend departure of President Joseph Estrada, bracing markets elsewhere in Asia. Tokyo shares staged a late recovery to notch up their seventh successive gain.
In Tokyo, the Nikkei ended up 0.31 per cent at 14,032.42, after spending most of the day in negative territory.
The index was down more than one per cent at one point, as gains in the yen drove profit taking in exporter stocks.
The Nikkei's sequence of seven straight gains is its longest positive run since it rose for eight sessions in August 1999.
Trading was subdued in some markets ahead of the Chinese New Year holidays, but Manila celebrated a peaceful transfer of power from Estrada to Gloria Macapagal Arroyo.
The 33-share composite index leapt 17.6 per cent or 255 points, to end at 1,708 points; its biggest one-day gain ever.
"Many foreign funds that have sold down the Philippine market have participated today and a big percentage is foreign buying, probably higher than 50 per cent," says Vanessa Lim, Fund Manager, UCPB Trust, which manages funds close to 30 billion pesos.
The gains in most markets came despite a weaker lead-in from the United States. Singapore was a notable exception, as it was down around 0.80 per cent in afternoon trade.
US stocks were hurt on Friday by concerns over the slowing of the economy, with the blue-chip Home Depot warning of disappointing profits and US consumer sentiment falling to its lowest level in more than two years during December.
The Dow Jones industrial average fell 90.7 points (0.9 per cent) to 10.587.6, while the Nasdaq index finished up less the two points (0.07 per cent) at 2,770.4.
The softer US market took some of the momentum out of the US dollar, which had hit a 17-month high of 119.90 yen last week, and it eased to a one-week low of 116.25 yen.
That saw investors taking profit on Japanese exporter stocks such as Sony, which had gained as the weakening yen boosted their potential export income before the late recovery.
"The yen's rebound is inviting investors to lock in profits on export-sensitive high-techs after last week's surge," says Hidenori Kawasaki, General Manager, Equity Trading Division, Kokusai Securities.
The Philippines' record gains bolstered Hong Kong's Hang Seng Index, which hit 16,000 points for the first time in three months.
At the midday break, the Hang Seng was up 0.85 per cent at 16,069.4. A key driver was the 21 per cent gain in First Pacific, a conglomerate with many assets in Philippines.
However, the index was struggling to go too far beyond 16,000 in late morning trade, as many blue chips drew profit taking in the wake of sharp gains late last week and ahead of the holidays.
The Hong Kong stock market will close on Tuesday at lunchtime for the lunar New Year holiday, and will reopen next Monday. Taiwan's market is already closed and will also reopen next Monday.
Other markets posted moderate gains, with the holidays and a broader concern about a US-led global slowdown which made investors cautious.
"The market is on hold until it is clear where the economy is headed, and we haven't had an Australian interest rate cut yet so it's a wait and see situation for many investors," says Caroline Egan, Commonwealth Securities equities writer.
The S&P ASX 200 index finished up 8.1 points at 3,319.7.
New Zealand also posted good gains. Its eighth successive higher close took the benchmark NZSE-40 Capital Index to 2,020.23, its highest close since September 19.
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