Asia stocks rise on US data, budget talks

AP News
Posted: Nov 29, 2012 10:07 PM
Asia stocks rise on US data, budget talks

BANGKOK (AP) — Asian stock markets posted gains Friday on optimism over a pair of positive U.S. economic reports and growing expectations that Washington will resolve a budget impasse before the end of the year.

Meanwhile, the release of an 880.3 billion yen ($10.7 billion) stimulus package by the Japanese government helped boost the Nikkei 225 index in Tokyo. The benchmark rose 0.8 percent to 9,480.26 in early trading.

Hong Kong's Hang Seng added 0.7 percent to 22,059.10 and Australia's S&P/ASX 200 advanced 0.8 percent to 4,512.90. South Korea's Kospi was nearly unchanged at 1,934.73. Benchmarks in Taiwan, Singapore and New Zealand also rose.

Investment sentiment was boosted by signs of improvement in the world's No. 1 economy.

The Commerce Department raised its estimate of third-quarter growth to an annual rate of 2.7 percent — much better than the 2 percent rate estimated a month ago. A drop in claims for unemployment benefits. Additionally, the number of Americans applying for unemployment benefits dropped by 23,000 to 393,000 last week, the Labor Department said. The figures were in line with expectations.

Investors have been tracking the talks between the White House and Congress over the "fiscal cliff," a reference to sharp government spending cuts and tax increases scheduled to start Jan. 1 unless a deal is reached to cut the budget deficit. Economists have been warning that failure to resolve the issue will severely impact the U.S. economy, the world's largest.

Analysts said the focus of attention will likely remain on the U.S. in coming weeks, especially now that countries that use the euro and the International Monetary Fund have agreed to carry on funding nearly bankrupt Greece.

"For the day ahead, the 'fiscal cliff' will likely remain in focus while economic data are expected to take a back seat given a relatively light data calendar," said analysts from Credit Agricole CIB in Hong Kong.

No major progress was reported after contentious talks in Washington on Thursday, with Republican House Speaker John Boehner rebuffing a proposal by President Barack Obama because it lacked "sensible spending cuts." But it is widely expected that a compromise will be reached before the deadline.

Benchmark oil for January delivery was down 35 cents to $87.72 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.58 to close at $88.07 on Thursday on the Nymex.

In currencies, the euro rose to $1.2997 from $1.2972 Thursday in New York. The dollar rose to 82.44 yen from 82.15 yen.


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