Singapore: Asian and European shares rose yesterday on increasing expectations that the US Federal Reserve will ease policy to support the economy and following an upbeat fourth-quarter forecast from computer chipmaker Intel.
The dollar remained broadly weak after details of the last meeting of the US Federal Reserve suggested the central bank was closer to injecting fresh stimulus into the ailing economy.
Comments by Japan on South Korea's leadership of the forthcoming G20 forum underlined growing currency tensions globally.
Finance Minister Yoshihiko Noda questioned Seoul's regular currency market interventions.
Intel, the world's largest chipmaker, raised expectations for higher technology earnings in the fourth quarter by forecasting stronger sales and margins for the period. The outlook was part of its third-quarter earnings reported after Wall Street closed, and the stock climbed one per cent in after-hours trade.
"It's not that Intel's results and outlook were great, but they were modestly better than the market's already lowered expectations," said Lee Min-hee, an analyst at Dongbu Securities in Seoul, where the Korea Composite Stock Price Index (KOSPI) ended up 0.43 per cent.
"It is such relief that is lifting technology stocks. The PC market has been showing signs of improvement since September, and key memory chip prices are expected to stabilise by the end of this year."
Optimism
The pan-European FTSEurofirst 300 index of top shares rose 0.3 per cent. The STOXX Europe 600 Technology index gained 0.7 per cent.
However, falls in the banking sector limited European gains. Standard Chartered slipped 4.4 per cent after it said it plans to raise £3.3 billion ($5.3 billion) through a rights offering to raise its capital adequacy ratio.
In Asia, shares of Hynix Semiconductor, the world's No. 2 memory chipmaker, rose 3.54 per cent. TSMC, the world's biggest contract chipmaker, rose 0.9 per cent.
The tech optimism also surfaced in India with No. 2 outsourcers Infosys climbing 1.3 per cent on expectations of strong earnings results due tomorrow.
Tata Consultancy Services and Wipro, the No. 1 and No. 3 software services exporters, were up 1.9 and 1.3 per cent respectively.
"IT spend at Indian techs top clients is on the rise even as rising deal pipelines, acceleration in discretionary spend and increasing deal sizes indicates greater confidence at client end," brokerage CLSA said in a note this week.
"Infosys and TCS remain our preferred picks to play this top-line upswing," it said.
Expectations that the US Fed is poised to revive the country's faltering recovery has spurred something of a worldwide equity rally. The Fed next meets to review policy on November 2-3.
US stocks hit a five-month high on Tuesday. The S&P 500 index is up 11.3 per cent since the start of September, and last month's performance was one of the best for stocks in a decade.
MSCI's all-country world equity index has posted a 12.1 per cent gain since the beginning of September. The index was up 0.5 per cent.
MSCI's Asia ex-Japan index rose 0.9 per cent.
Hong Kong's Hang Seng index was up 0.31 per cent while Tokyo's Nikkei closed 0.2 per cent higher.
Still, the Nikkei was capped by concerns over the yen's strength. The dollar rose 0.1 per cent to 81.87 yen, but was not far away from a 15-year low of 81.37 struck on Monday.
