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Asian stock markets rise slightly on momentum from last-minute US 'fiscal cliff' resolution

By: Pamela Sampson, The Associated Press

Posted: 01/2/2013 1:58 AM | Comments: 0 | Last Modified: 01/2/2013 10:17 PM

Filipino traders hear a mass before the start of the first day of trading at Philippine Stock Exchange at the financial district of Makati, south of Manila, Philippines on Wednesday Jan. 2, 2013. Stock markets in Asia registered relief Wednesday over the U.S. congressional vote to stop hundreds of billions of dollars in automatic tax increases and spending cuts that risked plunging the world's biggest economy into recession. (AP Photo/Aaron Favila)

BANGKOK - Asian stock markets rose again Thursday on a second day of momentum from Washington's agreement preventing the U.S. from going off the so-called fiscal cliff.

Hong Kong's Hang Seng Index rose marginally to 23,316.94. Australia's S&P/ASX 200 rose 0.6 per cent to 4,733. Benchmarks in Singapore, Taiwan, Indonesia and New Zealand also rose. South Korea's Kospi fell 0.5 per cent to 2,020.17.

Markets in Japan and mainland China were closed for extended holidays.

Wall Street stocks soared Wednesday, the first trading day of the year, amid investor relief that Republicans and Democrats hammered out a last-minute budget deal, though the compromise left many issues unresolved.

The deal doesn't include any significant deficit-cutting agreement, meaning the country still doesn't have a long-term plan or even an agreement in principle on how to curb spending. Big cuts to defence and domestic programs, which would have hit with the new year, weren't worked out but instead were delayed for two months.

"Continued advances will depend on how spending deals are or are not negotiated over the next two months and whether any down payment on the national debt is made," said analysts at DBS Bank Ltd. in Singapore.

Mixed data on manufacturing and construction spending in the U.S. didn't dent investor enthusiasm. The Dow Jones industrial average finished 2.4 per cent higher at 13,412.55. The Standard & Poor's 500 index rose 2.5 per cent to 1,462.42. The Nasdaq composite index shot up 3.1 per cent to 3,112.26.

U.S. manufacturing grew slightly last month and factory hiring increased. The modest gain suggests the economy entered the new year with some momentum.

The Institute for Supply Management said Wednesday that its index of manufacturing activity rose in December to 50.7, up from a reading of 49.5 in November. A reading above 50 indicates growth, while a reading below signals contraction.

Spending on U.S. construction projects fell in November from October because a steep drop in volatile federal projects offset another gain in home building.

Benchmark oil for February delivery fell 52 cents to $92.60 in electronic trading on the New York Mercantile Exchange. The contract rose $1.30 to finish at $93.12 per barrel on the Nymex on Wednesday.

In currencies, the euro fell to $1.3140 from $1.3178 in late trading Wednesday in New York. The dollar rose to 87.21 yen from 87.14 yen.

___

Follow Pamela Sampson on Twitter at http://twitter.com/pamelasampson

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