Asian shares gain on strong factory data for China, Japan

In Photo: A man looks at an electronic stock board of a securities firm in Tokyo on October 2. Shares in Asia are higher after China and Japan reported stronger-than-expected factory data. Many markets in the region were closed on Monday for national holidays.

TOKYO—Shares in Asia are higher after China and Japan reported stronger-than-expected factory data. Markets in China, Hong Kong, India and South Korea were closed on Monday for national holidays.

Keeping score: Japan’s Nikkei 225 stock index rose 0.2 percent to 20,400.78 and the S&P ASX/200 jumped 0.8 percent to 5,729.30. Shares in Taiwan and Southeast Asia also gained.

Wall Street last week: The market ended the quarter on a four-day winning streak that began after Federal Reserve Chairman Janet Yellen said the central bank plans to continue raising interest rates. The Standard & Poor’s 500 index rose 0.4 percent to 2,519.36 and the Dow Jones industrial average eked out a 0.1-percent gain to 22,405.09. The Nasdaq composite jumped 0.7 percent to 6,495.96. The S&P 500 and Nasdaq both closed at all-time highs.

Japan economic data: The Bank of Japan’s quarterly tankan survey showed an improved outlook for the world’s third-largest economy. The survey of leading manufacturers indicated growing shortages of factory capacity that could compel companies to invest more, helping to drive growth. Another private-sector survey, the Nikkei purchasing managers’ index, likewise, showed manufacturers increasing output to meet a rise in new orders. Market reaction was muted, however, given other uncertainties, such as the North Korean situation and a snap election planned for October 22.

Analyst viewpoint: “The real question may be how the economic environment evolves with regard to snap elections and lingering geo-politics involving a nuclear-armed North Korea. The upshot is that after six successive quarters of growth, corporate Japan is still going strong, but politics and geo-politics may inadvertently be bugbears,” Mizuho Bank Ltd. said in a commentary.

China: An official survey released last Saturday said China’s factory activity expanded in September at the fastest pace in five years, as the country’s vital manufacturing sector stepped up production to meet strong demand. The official manufacturing purchasing managers’ index rose to 52.4 in September, up from 51.7 in the previous month and the highest level since April 2012. The report by the Federation of Logistics & Purchasing said production, new export orders and overall new orders grew at a faster pace for the month.

Energy: Benchmark US crude lost 9 cents to $51.58 a barrel. It rose 11 cents to $51.67 a barrel last Friday in New York. Brent crude, the standard for international oil prices, shed 19 cents to $56.60 a barrel. US crude oil rose 12 percent in the third quarter, which helped energy companies do better than the rest of the market.

Currencies: The dollar rose to ¥112.89 from ¥112.46 last Friday. The euro slipped to $1.1766 from $1.1813.

Image Credits: AP