TOKYO – Asian shares rose Wednesday as China reported its economy expanded at a steady 6.7 per cent pace in the July-September quarter, better than some forecasters had expected. Sentiment was also lifted by a strong day on Wall Street, fueled by upbeat earnings reports.
KEEPING SCORE: Japan’s Nikkei 225 index rose 0.1 per cent to 16,987.16 and Australia’s S&P ASX/200 added 0.3 per cent to 5,429.00. The Kospi in South Korea jumped 0.4 per cent to 2,048.45 and Shanghai’s Composite index advanced 0.3 per cent to 3,092.46. Shares in Southeast Asia were mixed, and Hong Kong’s Hang Seng index lost 0.2 per cent to 23,339.67.
CHINA STEADY: The 6.7 per cent annual pace of growth was supported by strong consumer spending that helped offset weakness in trade. That was in line with the two previous quarters and better than some forecasters expected. “We won’t get the full breakdown until tomorrow but we suspect that the key driver was stronger growth in real estate services, on the back of buoyant property sales. Financial sector growth is also likely to have recovered as last year’s equity bubble dropped out of the base for comparison,” Julian Evans-Pritchard of Capital Economics said in a commentary.
WALL STREET GAINS: Surprisingly strong earnings from Netflix, UnitedHealth Group and other companies put investors in a buying mood Tuesday, driving U.S. stocks solidly higher. Health care stocks led the gainers. Materials, utilities, energy and a broad swath of other companies also posted gains. The Dow Jones industrial average rose 0.4 per cent, to 18,161.94, while the Standard & Poor’s 500 index climbed 0.6 per cent to 2,139.60. The Nasdaq composite index surged 0.8 per cent to 5,243.84.
ANALYST VIEWPOINT: “U.S. markets have provided Asia with a healthy platform from which to progress,” Chris Weston of IG said in a report. “We’ve also seen a slew of earnings reports (including Goldman Sachs) and once again whether one is looking at the underlying earnings or the sales lines, companies are beating the analysts’ estimates.”
OIL: U.S. benchmark crude oil gained 44 cents to $50.73 a barrel after a report of a drawdown in inventories. It rose 35 cents to $50.29 a barrel in New York. Brent crude, the international standard, was up 42 cents at $52.10 a barrel in London.