Asian market gains ahead of US poll results

05 November 2008 03:51  [Source: ICIS news]

SINGAPORE (ICIS news)--Asian markets were trading higher on Wednesday tracking US markets gains ahead of the US poll results, with Democrat Sen. Barack Obama emerging as a likely winner based on latest tally.

 

“Perhaps with a strong mandate, the new government will get on the job of turning around the economy very quickly,” said Song Seng Wun, regional economist at Malaysian brokerage CIMB-GK.

 

The Dow Jones industrials jumped 305.45 points or 3.3% at 9,625.28 as the close of the US presidential elections took out one uncertainty in the markets.

 

Analysts expect the “bear market rally” to be short-lived as fears of an impending global recession would continue to weigh down on sentiment.

 

“How long this will last is anyone’s guess because numbers on the real economy look pretty bad. It is a question of how much has it been discounted,” said Song.

 

The region’s petrochemical stocks were swept along with the tide of gains.

 

At 10.53 hours Singapore time (0253 GMT), China’s state-owned oil refiner Sinopec up 8.40% and PetroChina jumped 8.45% as the Hang Seng Index gained 5.51% at 15,178.09.

 

South Korea’s Hanwha Chemical rose 7.36%, LG Chem up 4.86% and SK Energy 3.29% higher as the KOSPI Composite index surged 4.89% to 1,209.71

 

In Japan, Asahi Kasei was up 2.71%, Mitsui Chemicals 4.95% higher and Mitsubishi Chemical up 1.96% as the Nikkei 225 rose 2.82% at 9,371.67.

 

“From the standpoint of investors, the markets have fallen very steeply over the last couple of months so that gave them an opportunity for a bit of bargain-hunting,” said Song.

 

Investors may also taking comfort from a host of fiscal stimuli across the region to stave off a likely protracted recession, analysts said.

 

Malaysia has announced late Tuesday a ringgit (M$)7bn economic package while it lowered its economic growth expectations next year to 3.5% from 5.4%.

 

Australia surprised the markets yesterday with a 75-basis point cut in interest rates, which helped buoy regional markets.

 

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By: Pearl Bantillo
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