Hang Seng close to year-high

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Asian markets ended the week strongly on Friday as positive retail sales in the US and strong earnings helped offset continuing concerns over Greece’s sovereign debt.

Rising expectations of a change in the Chinese government’s currency policy also helped some sectors higher. The FTSE Asia-Pacific index put on 0.4 per cent to 244.65 for a five-day gain of 1.2 per cent. On Wednesday, the index closed at its highest level for more than 20 months.

On Friday, the Hang Seng advanced 1.6 per cent to 22,208.50 for a weekly gain of 3.1 per cent – its biggest weekly rise in six. The index is now less than 1 per cent shy of its year-high hit in early January.

“The momentum is in place,” said Danny Yan, of Taifook Asset Management. “Valuations aren’t demanding. Conditions aren’t ripe for imminent tightening. US retail sales also show signs of picking up. I’m reducing cash and deploying it to sectors related to the yuan-appreciation theme.”

ZTE, a telecommunications equipment maker, added 3.7 per cent to HK$48.65 on Friday after reporting a 50 per cent jump in quarterly profits.

Tsingtao Brewery, China’s number two beer maker by volume, gained 2.5 per cent to HK$41.20 after its first-half profit leapt 92 per cent on rising sales and lower costs.

The Nikkei 225 Average increased 0.3 per cent on Friday to 11,204.34 for a weekly loss of 0.7 per cent.

The Japanese benchmark hit 18-month highs during the week but later fell back as strength in the yen prompted profit-taking.

Fast Retailing rose 3.1 per cent to Y15,470 after reporting a 43 per cent jump in first-half profit. Seven & I Holdings, Japan’s largest retailer, surged 6.1 per cent to Y2,456 after saying it would buy back more than 2 per cent of its shares.

In the mainland Chinese market, the Shanghai Composite gained 0.9 per cent to 3,145.347 on Friday but fell back 0.4 per cent for the week.

Airlines continued to gain on Friday on hopes that an appreciation of the renminbi will help reduce foreign debts. Air China was up 3 per cent to Rmb13.54 for a weekly rise of 11.2 per cent.

The Thai market finally felt the pressure of political unrest this week. The SET gained 0.7 per cent on Friday to 789.66 but finished the week 1.4 per cent lower.

On Thursday, the government declared a state of emergency, which limits investment from some foreign funds. But the index is still 13.4 per cent higher since the start of February.

The Indonesian market saw a second straight day of selling, closing down 0.2 per cent to 789.66 on Friday. The index hit record closing highs on Monday and Tuesday as foreign investors bought Indonesian stocks.

In India, the BSE Sensex achieved its seventh consecutive weekly gain, up 1.4 per cent to 17,935.42.

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