Mumbai, Dec 23: Asian stock markets were mostly higher Wednesday after a jump in U.S. housing starts suggested the world’s biggest economy is picking up speed.
Shanghai, Seoul and Sydney all rose after major U.S. indexes gained Tuesday on news that November home resales jumped 7.4 percent, above a forecast 2.5 percent.
The housing figures, which came after upbeat earnings and forecasts from technology companies and more corporate dealmaking, countered gloom about third quarter economic growth being revised lower.
“It’s being driven by sentiment out of the U.S. and the fact that U.S. markets continue to hold up in the face of rather mixed data,” said Kirby Daley, senior strategist at Newedge Group in Hong Kong.
China’s benchmark Shanghai Composite Index rose 12.70 points, or 0.5 percent, to 3,064.29, while Sydney’s S&P/ASX added 0.6 percent to 4,731.8. Tokyo was closed for a holiday after the benchmark Nikkei 225 added 1.91 percent on Tuesday.
Hong Kong bucked the regional trend, with its Hang Seng Composite Index shedding 10.21, or 0.1 percent, to 21,081.83.
Investors were closely watching U.S. markets in the absence of major Asian developments.
“The market realizes that as long as China remains strong, Asia is going to benefit, and as long as the U.S. doesn’t hit a major bump in the road, Asia will remain stable,” Daley said. However, he said that after recent strong gains, “I don’t think there will be a significant push higher.”
China’s government is forecasting full—year 2009 growth of 8.3 percent following a rebound driven by Beijing’s 4 trillion yuan ($586 billion) stimulus. Private sector economists expect growth of up 9.4 percent.
The Shenzhen Composite Index for China’s smaller second exchange added 11.10 points, or 1 percent, to 1,120.53.
Elsewhere, Seoul’s Kospi was up 0.2 percent at 1,658.3, while Singapore added 0.5 percent and Taiwan’s Taiex gained 0.6 percent.
Tuesday on Wall Street, the Dow Jones industrial average rose 50.79, or 0.5 percent, to 10,464.93 following the housing report by the National Association of Realtors.
The Standard & Poor’s 500 index rose 3.97, or 0.4 percent, to 1,118.02, while the Nasdaq composite index rose 15.01, or 0.7 percent, to 2,252.67. Both the S&P 500 and the Nasdaq are at their highest levels since last October.
That came despite a government report revising down U.S. third—quarter gross domestic product growth. The Commerce Department’s new reading showed a growth rate of 2.2 percent, down from the previous estimate of 2.8 percent. The growth, while smaller than originally believed, still managed to break a record four straight quarters of decline.
Oil fell 4 cents to $74.36 in electronic trading on the New York Mercantile Exchange.
In currencies, the dollar rose 0.1 percent to 91.69 yen. The euro was down slightly at $1.4248.
–Agencies