Asian stocks up as US data boost sentiment
SEOUL, South Korea (AP) — Asian stock markets were mostly higher Thursday after a surge in new home sales in the U.S. bolstered sentiment. But gains were limited by worries about Europe's stagnant economy and violence in Iraq and Syria.
KEEPING SCORE: Japan outperformed the region with the Nikkei 225 up 1.2 percent to 16,364.74 after the dollar rose above 109 yen overnight, a fresh six-year high. In mainland China, the Shanghai Composite rose 0.3 percent to 2,351.39. Australia's S&P/ASX 200 added 0.1 percent to 5,380.30. Stocks in Southeast Asia rose. South Korea's Kospi drifted 0.1 percent lower to 2,034.80 and Hong Kong's Hang Seng edged down 0.2 percent to 23,884.90.
HOUSING JUMP: The Commerce Department said new home sales climbed 18 percent in August to an annual rate of 504,000 homes, beating the 430,000 expected by economists. It was the fastest clip since May 2008 and a sign that the real estate market might improve after the recovery from the Great Recession stalled during the past year because of sluggish wage growth and rising prices.
ANALYST TAKE: The unexpected increase in U.S. home sales may "indicate that young people are perhaps now starting to feel economically secure enough to buy their own homes," Chang Wei Liang of Mizuho Bank said in a commentary. "Continuation of this strength would provide further concrete evidence that even the labor market for young people is already near normality."
SLOW EUROPE: On Wednesday, data showed that business confidence in Germany, Europe's largest economy, dropped for the fifth straight month. The Ifo institute said its confidence index dropped to 104.7 points for September from 106.3 last month as the mood among executives darkened regarding both the current situation and the outlook for the next six months. The fall was bigger than anticipated.
WALL STREET: The Dow Jones industrial average advanced 0.9 percent to 17,210.06 on Wednesday, its best day since Aug. 18. The Standard & Poor's 500 rose 0.8 percent to 1,998.30 and the Nasdaq composite rose 1 percent to 4,555.22.
ENERGY: Benchmark U.S. crude oil edged down 7 cents to $92.73 a barrel on the New York Mercantile Exchange. On Wednesday, the contract rose $1.24 to $92.80 after the government reported a larger-than-expected decline in oil stocks.
CURRENCY: The euro dropped to $1.2767 from $1.2777 late Wednesday. The dollar fell to 109.14 yen from 109.19 yen.