Friday, November 1, 2013
Asian Stocks Mostly Solid In Oct Despite U.S. Upheaval
SINGAPORE (NQN)--Markets in Asia were mostly bullish in October despite being weighed down by U.S. fiscal issues in the first half of the month, when the deadlock between Democrats and Republicans over the U.S. debt ceiling triggered a government shutdown.
Buying began gaining momentum gradually on speculation that the U.S. Federal Reserve Board will likely extend its quantitative easing and on expectations of strong corporate earnings for the quarter ended September. Investors were also buying stocks because they became less risk-averse after the Dow Jones industrial average hit an all-time high.
The Indian rupee was bought back as the Indian government lifted its monetary tightening measures, pushing up Indian stocks significantly. As a result, the Bombay Stock Exchange Sensex index hit a series of all-time highs toward the end of October. The benchmark stock indexes in South Korea, Taiwan and Malaysia also hit their year-to-date highs.
In countries such as India, Indonesia, Thailand and South Korea, stock indexes at the end of September were lower than at the beginning of the year but turned into positive territory at the end of October. In India, solid earnings announcements prompted investors to buy key issues, including IT, banks and telecommunications firms, helping the Sensex index rise. In Southeast Asia, investors began buying back risk assets after selling them off on speculation that the U.S. might start cutting back its bond purchases.
The Shanghai Composite Index remained in negative territory as of Thursday compared with the beginning of the year. But with the Chinese Communist Party's third plenary session, where economic reform measures will be established, set for Nov. 9-12, expectations for the government's growth promotion measures are supporting the market.