By V. Phani Kumar, MarketWatch
HONG KONG (MarketWatch) — Asian stocks rallied Thursday after Federal Reserve Chairman Ben Bernanke said U.S. interest rates will remain low to aid economic recovery, with gold miners posting hefty gains on an increase in commodity prices.
Mainland Chinese stocks led the jump on speculation Beijing may act to stabilize economic growth, with the Shanghai Composite Index /zigman2/quotes/210598127/delayed CN:SHCOMP +0.05% soaring 3.2% for its best percentage gain so far this year. The advance came on top of a 2.2% rise on Wednesday.
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“I think emerging markets were doing pretty awfully. What we’re seeing is a reversion trade as a weaker dollar is net positive,” said Ben Collett, head of Asian equities at Sunrise Brokers. “In China, the markets are telling us that we are close to some sort of intervention.”
Meanwhile, Nomura economist Zhiwei Zhang wrote in a note to clients that the tone in a speech made by Premier Li Keqiang on Tuesday — in which he mentioned the need to stabilize growth — suggested Beijing’s policy stance may soften in the second half of 2013.
The Shanghai Composite is among the worst performing major benchmarks in Asia so far in 2013, having dropped 8.6% from last year’s close, amid worries that Beijing’s reluctance to provide additional fiscal or monetary stimulus would deepen an economic slowdown.
Also posting solid gains, South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 -1.48% jumped 2.9% after the Bank of Korea left its policy interest rate unchanged. Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI -1.54% gained 2.6%, and Australia’s S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO -0.16% climbed 1.3%.
The Nikkei Stock Average /zigman2/quotes/210597971/delayed JP:NIK -1.40% added 0.4% in Tokyo after the Bank of Japan cut its growth and inflation forecasts, and refrained from adding fresh stimulus, saying the domestic economy was starting to “recover moderately.” The higher finish came after a volatile trading session that saw the benchmark change direction multiple times during the session.
“The reactions of the market are fairly intense to small Fed nuances, an indication of some fundamental instability or great uncertainty in the market,” said Société Générale currency strategist Sebastien Galy.
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“‘Helicopter Ben’ is generally good for equities and bad for the U.S. dollar, so we have a good idea of the short-term reaction until we hit another bout of very decent U.S. data,” Galy said.
Resource stocks posted solid gains after commodity prices rallied overnight.
Shares of gold miners were particularly upbeat after the precious metal’s futures rose for a third straight day. Newcrest Mining Ltd. /zigman2/quotes/203840223/delayed AU:NCM -1.40% /zigman2/quotes/203286036/delayed NCMGY -2.11% soared 11.6%, and Perseus Mining Ltd. /zigman2/quotes/205179925/delayed AU:PRU 0.00% /zigman2/quotes/202190906/delayed PMNXF -0.75% surged 23.7% in Sydney, while Zijin Mining Group Co. /zigman2/quotes/204517000/delayed HK:2899 -1.54% /zigman2/quotes/203833875/delayed CN:601899 -0.87% /zigman2/quotes/209836076/delayed ZIJMF +3.90% stock rose 5.3% in Hong Kong and 0.6% in Shanghai.
Among the region’s oil producers, Inpex Corp. /zigman2/quotes/206689846/delayed JP:1605 -0.86% /zigman2/quotes/206936121/delayed IPXHF +5.94% climbed 2% in Tokyo and Woodside Petroleum Ltd. /zigman2/quotes/203437212/delayed AU:WPL -1.32% /zigman2/quotes/206334215/delayed WOPEY -3.21% rose 1.6% in Sydney. Cnooc Ltd. /zigman2/quotes/203421416/delayed HK:883 -2.12% /zigman2/quotes/204964401/composite CEO -0.86% jumped 4.1% in Hong Kong and heavyweight PetroChina Co. /zigman2/quotes/204979431/delayed HK:857 -1.16% /zigman2/quotes/205108732/composite PTR -0.27% climbed 2.7% in Shanghai.
The gains came as U.S. benchmark crude-oil futures /zigman2/quotes/209725769/delayed CLQ23 -51.04% topped $107 a barrel during the Asian trading day, after settling at their highest level in 15 months overnight in New York.
Financials were among the biggest gainers on mainland bourses, with Industrial Bank Co. /zigman2/quotes/209353019/delayed CN:601166 -1.38% and Sinolink Securities Co. /zigman2/quotes/205648937/delayed CN:600109 +3.04% soaring by the day’s limit of around 10% in Shanghai, while Hong Yuan Securities Co. and Ping An Bank Co. /zigman2/quotes/206600939/delayed CN:000001 -1.11% also rose 10% in Shenzhen.
/zigman2/quotes/210598069/delayed 180721 2,208.88, -33.29, -1.48%
/zigman2/quotes/210598065/realtime DJIA 29,398.08, -25.23, -0.09%
Property developers and financials also rallied in Hong Kong. Sino Land Co. /zigman2/quotes/202960683/delayed HK:83 -1.44% /zigman2/quotes/206858840/delayed SNLAY +2.40% climbed 3.2% and China Resources Land Ltd. /zigman2/quotes/202417326/delayed HK:1109 -2.08% /zigman2/quotes/201656413/delayed CRBJF +5.00% soared 6.6%, while China Life Insurance Co. /zigman2/quotes/202359856/delayed HK:2628 -1.13% /zigman2/quotes/206573290/composite LFC -0.88% gained 6.4%.
Hong Kong property developers tend to benefit from increased demand amid low interest rates in the U.S., given that rates in the territory — which pegs its currency to the U.S. dollar /zigman2/quotes/210562005/realtime/sampled USDHKD +0.0064% — move in lock-step with the federal funds rate.
Technology and steel shares jumped in Seoul, with heavyweight Samsung Electronics Co. /zigman2/quotes/209800866/delayed KR:005930 -2.76% /zigman2/quotes/202367843/delayed SSNLF 0.00% rising 5.1%, and Hyundai Steel Co. /zigman2/quotes/203290957/delayed KR:004020 -0.52% climbing 5.4%.
In Tokyo, several exporters weakened on the yen’s /zigman2/quotes/210561789/realtime/sampled USDJPY -0.1493% strength, as the dollar lost hold of the ¥100 level and dropped as low as ¥98.23 after the Bank of Japan meeting outcome.
Toshiba Corp. /zigman2/quotes/205628942/delayed JP:6502 -3.42% /zigman2/quotes/204149068/delayed TOSYY +2.75% dropped 1.9%, Nikon Corp. /zigman2/quotes/203281219/delayed JP:7731 +0.59% /zigman2/quotes/209396469/delayed NINOY -1.38% lost 3.7%, and Canon Inc. /zigman2/quotes/207639533/delayed JP:7751 -0.53% /zigman2/quotes/210242912/composite CAJ -1.31% shed 1.5%.