Asian markets climb

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Published Dec 23, 2013

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Asian markets climbed on Monday following a record lead from Wall Street after US economic growth figures came in well above expectations.

Chinese shares picked up after the mainland's central bank last week injected funds into financial markets to calm fears of a cash crunch.

Sydney climbed 0.51 percent, or 26.7 points, to end at 5,291.9 and Seoul rose 0.68 percent, or 13.54 points, to close at 1,996.89.

Shanghai added 0.24 percent, or 4.91 points, to end at 2,089.71, the first positive close in 10 sessions. Hong Kong closed 0.48 percent, or 109.38 points, higher at 22,921.56.

Tokyo was closed for a public holiday.

US shares rallied on Friday after the Commerce Department said the economy grew 4.1 percent year-on-year in July-September, much faster than estimated and up from 2.5 percent in the previous three months.

It was the strongest growth in the world's largest economy since the fourth quarter of 2011, when the pace hit 4.9 percent.

The news came after a decision by the Federal Reserve to trim its stimulus programme by $10 billion to $75 billion a month from January, citing a pick-up in the economy and falling unemployment.

On Wall Street Friday, the Dow added 0.26 percent and the S&P 500 rose 0.48 percent -- both ending at record highs -- while the Nasdaq climbed 1.15 percent.

Chinese shares rose after suffering a sell-off Friday on concerns about a cash crunch similar to one that hit in June.

Dealers welcomed a huge injection of liquidity into financial markets last week by the central People's Bank of China after interbank borrowing rates -- which lenders charge each other to borrow cash -- shot up.

The bank pumped 300 billion yuan ($49.4 billion) into the market, sending rates falling from 8.2 percent on Friday to 5.57 percent in early trade on Monday.

The turmoil last week came as banks and other investors scrambled for cash as they approach the end of the year, when they typically have to meet regulatory requirements and funding demands from companies.

However, Amy Lin, an analyst at Capital Securities told Dow Jones Newswires: “The market is clouded by concerns of a liquidity crunch. Sharp rises in stock indexes are unlikely in the coming month.

“All eyes are on the central bank now, with hopes it could continue to inject funds into the market.”

In forex trade the dollar bought 104.00 yen compared with 104.06 yen in New York Friday. The euro bought $1.3670 against $1.3671, while it was at 142.30 yen from 142.31 yen.

Oil prices were lower. New York's main contract, West Texas Intermediate for February delivery, was down 32 cents at $99.00 in afternoon trade, while Brent North Sea crude for February eased six cents to $111.71.

Gold fetched $1,201.50 at 0800 GMT compared with $1,195.25 late Friday.

In other markets:

-- Taipei rose 0.57 percent, or 47.93 points, to 8,456.46.

Taiwan Semiconductor Manufacturing Co. gained 1.96 percent to Tw$104.0 while Cathay Financial Holdings was 1.08 percent higher at Tw$47.0.

-- Wellington rose 0.89 percent, or 41.44 points, to 4,722.64.

Fletcher Building added 1.67 percent to NZ$8.54, Telecom added 1.30 percent to NZ$2.34 and Air New Zealand was off 1.52 percent at NZ$1.62.

-- Manila rose 0.34 percent, or 19.75 points, to 5,854.88.

SM Prime Holdings closed unchanged at 14.50 pesos while Union Bank rose 0.32 percent to 125.40 pesos. - AFP

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