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Friday, November 21, 2008

Asian Summary on 21112008

Shares in Asia stage turnaround then grind higher despite large losses on Wall Street, though markets volatile in thin volume amid pre-weekend caution. Nikkei ends +2.7%, rebounding intraday on short covering; reports Citigroup mulling sale of parts or all of its business spur hopes of positive reaction in U.S. markets. Kospi +6.1%, STI +2.7%, S&P/ASX 200 ends +1.9%, China shares +0.3%, all after opening lower as Dow Futures turn higher in screen trade. India's Sensex opened in green, taking note of Asian peers' recovery, now +4.3%.

USD/JPY higher at 94.80 vs 93.92 late in NY, EUR/JPY at 118.83 vs 117.08; short-term players, Asian hedge funds sell yen on rise in Nikkei, U.S. futures ahead of Japan's three-day weekend. RBA intervened in forex market after AUD/USD fell close to 0.6000 level though RBA says move to supply liquidity, not defend levels; pair now at 0.6216 off 0.6077 early low, weakest level since Oct. 28. Intervention also suspected in India as USD/INR hovering around key 50 level. Risk-sensitive regionals IDR, KRW, THB down against dollar. BOJ keeps rates at 0.30%, in line with market expectations; lead December JGBs gave up some gains pre decision on disappointment over lack of fresh policy initiatives. Governor Shirakawa briefing press around 0630 GMT. Japan CDS blows out to record wide on uncertainty over fate of Big Three U.S. automakers, Citigroup reports; iTraxx Japan Series 10 hit 375 bps, out from 335 bps Thursday, before coming in a bit to 365 bps. Singapore government announced S$2.3 billion stimulus package, involving government backing for bank loans, extra spending in 2009 after 3Q GDP contracted 0.6% on-year vs 0.5% fall in advance estimate; down 6.8% on-quarter vs minus 6.3% advance estimate; government cut 2008 GDP growth outlook to 2.5% from 3%, reckons economy may contract in 2009, forecasting range of minus 1% to +2% amid deteriorating external demand.

St. Louis Fed President Bullard, speaking in Asian hours, seeks to calm deflationary fears, saying U.S. economy isn't close to entering deflationary period. Malaysia CPI due 0900 GMT. Spot gold up $4.35 at $748.95 vs NY close, gaining on strong risk-aversion bid. Nymex crude +44 cents on Globex at $49.86/bbl. (MAA)

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(END) Dow Jones Newswires

November 21, 2008 01:32 ET (06:32 GMT)

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