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Asian Markets Rise on Hopes of Rate Cut

CNBC.com with Wires
Thursday, 21 Feb 2008 | 5:26 AM ET

Most Asian markets made firm gains Thursday, as solid earnings and expectations of further U.S. interest rate cuts outweighed worries about inflation, even as oil hit a record high above $101 a barrel.

Japan's Nikkei 225 Average rose , with metal shares such as Sumitomo Metal Industries extending gains.

Bank of Ikeda and Senshu Bank both jumped more than 10 percent after the two Osaka-based regional banks said they were considering merger talks.

Meanwhile, Nintendo gained 3.9 percent on the Osaka exchange after the game maker said it would launch its Wii Fit physical fitness game in Europe in April and in the United States in May.

Seoul stocks rose 1 percent, as SK Telecom jumped after the government approved its $1.2 billion purchase of a hanarotelecom stake, while tech titles such as Samsung Electronics tracked firmer U.S. peers.

Steelmakers such as POSCO and Hyundai Steel continued to advance on increasing expectations that they would keep raising prices of steel products to catch up with iron ore price hikes.

Taiwan stocks rose 2.4 percent, while Hong Kong's Heng Sang Index gained 0.1 percent. Shanghai shares fell 0.9 percent on concerns about further new share issues flooding the market.

Australia's S&P/ASX 200 index added 1.6 percent, helped by solid earnings from telecommunications operator Telstra, pallet maker Brambles and national carrier Qantas.

Property and financial services group City Pacific surged 10 percent to A$2.86 after it said first-half net profit rose 13.3 percent to a record A$27.5 million ($25.2 million) and reiterated its guidance for a 10 percent growth in fiscal 2008.

Singapore's Straits Times Index gained 0.9 percent as investors snapped up shares of defence conglomerate ST Engineering, after the firm secured several contracts on Tuesday worth a total S$434 million ($307.8 million).