CMC Markets – Evening Update 19/11/12

By Donal Nee
Dealer
CMC Markets Singapore

Asian markets posted gains today with the Japanese market leading the charge. Japan’s Nikkei closed up 1.43% as it extended its winning streak for the 4th straight session.

The strong performance of the Japanese share market comes on the back of growing optimism that the Japanese opposition party will win support in next month’s election and in turn will put more pressure on the Japanese Central Bank to add more monetary stimulus.

Toyota Motor Corp. advanced 1.8%, Hitachi Ltd. added 2.3%, and Canon Inc. rose 3.7%. Markets across the region were also given a boost after Wall Street rose on Friday night as investor are beginning to turn a corner with hopes that President Obama and Congress can come to an agreement over the US fiscal cliff issue.

Australia’s S&P/ASX 200 climbed a modest 0.57% with shares of Billabong International Ltd. soared 10.4% after the surf wear clothing maker said the head of its U.S. division was contemplating a buyout of the company. Hong Kong’s Hang Seng Index advanced 0.3%.

On the local front, Singapore’s share market followed the rest of the Asian regions as it advanced 0.2% today. Commodities trader Noble Group followed its good run as the stock jumped by as much as 1.9% during trade.

The stock has performed well after an announcement last week that the Chairman and Chief Executive have increased their holdings in the company, Sembcorp Marine also posted gains of 1% today after the Oil Rig builder announced it has finalised a contract to build a semi-submersible rig worth over $295M.

Crude Oil followed its gains from Friday as it jumped 0.7% today to trade around $87.85 a barrel. The gains come as investors keep eyes on the impact the fighting could have on oil supplies. So far, those supplies have been ample. But they could be disrupted if the conflict between Israel and Hamas in Gaza spreads and destabilizes the Middle East.

All was quiet on the reporting front today however tomorrow we have the Japanese interest rate announcement and the Australian Monetary policy meeting minutes during the Asian session. Focus will then move over to Europe where we will have the Eurogroup meetings.

Later on Tuesday night we will get a good look into the state of the US housing sector as we see Building Permits and housing starts. Then on Wednesday we have October trade balance data from Japan which we are expecting to be adversely affected by their territorial disputes with China.