August 09, 2006	Wednesday	Rajab 13, 1427

HONG KONG, Aug 8: Asian stocks made solid gains on Tuesday with investors becoming increasingly convinced the US Federal Reserve will call a halt to its interest rate hike campaign when it meets later in the day.

Dealers said recent economic numbers out of the US had helped ease investor concern over another rate increase, which combined with a settling in oil prices and solid corporate results, propelled many markets sharply higher.

If the betting is correct, the US central bank is to pause on a campaign of hikes stretching back to June 2004 that has lifted the headline interest rate up to 5.25 per cent through 17 consecutive increases.

Tokyo led gains with a 2.05 per cent surge, Mumbai was 1.87 per cent higher Seoul jumped 1.67 per cent, Taipei rose 1.33 per cent and Sydney was up 1.27 per cent. Bangkok, Hong Kong, and Singapore also ended in positive territory.

However, an expected interest rate cut in Jakarta resulted in profit taking while Manila was also lower after its leading telecom reported a fall in half year net profit. Kuala Lumpur was flat.

TOKYO: Share prices closed 2.05 per cent higher on bargain-hunting, recouping most of the previous day's plunge despite jitters over the US Federal Reserve's rate decision.

Dealers said upbeat corporate earnings also cheered on the Japanese market, which dived Monday on question marks over the Federal Reserve meeting.

Uncertainty cleared up on Tuesday with analysts increasingly certain the US central bank will stop its long run of interest rate hikes.

The Nikkei-225 index climbed 310.60 points to 15,464.66. Volume was 1.39 billion shares, up from 1.37 billion Monday.

After the Nikkei-225 index lost more than 300 points yesterday, bargain hunters emerged, said Hiroyuki Nakai, chief strategist at Tokai Tokyo Research Center, adding that local corporate results also helped.

Hideyuki Suzuki, a strategist at SBI Securities, said investors appeared to have put aside their concerns about the Federal Reserve meeting starting later Tuesday and instead focused on picking up bargain stocks.

Yesterday's slump in the market was too much, Suzuki said.

Oil stocks rose after an overnight spurt in prices following British energy giant BP's announcement it was shutting down America's biggest oil field due to a leak. Cosmo Oil was up 13 yen at 552.

SYDNEY: Share prices climbed 1.27 per cent as investors anticipated strong results from the banking sector and a pause in US interest rate hikes.

Dealers said there was widespread anticipation that US interest rates would remain on hold in August and the US Federal Reserve would adopt a less hawkish monetary policy stance after it meets later in the day.

The SP/ASX 200 rose 63.0 points to 5,024.8. A total of 1.04 billion shares changed hands worth $4.06 billion (US$3.05bn).

SINGAPORE: Share prices closed 0.20 per cent higher on buying of select blue chip stocks, but caution ahead of the Federal Reserve's decision on US interest rates limited gains.Dealers said that while there is a growing consensus the Federal Reserve will not raise interest rates further, investors are still waiting to see if this consensus turns out to be correct.

KUALA LUMPUR: Share prices closed flat with trade confined in a tight range as investors awaited the outcome of a US interest rate decision.

The composite index was up 0.60 points at 939.08 and trading volume was 425.58 million shares.

JAKARTA: Share prices closed 0.53 per cent lower on profit-taking, with a largely expected move by the central bank to cut its key interest rate failing to spur further buying.

The composite index closed down 7.407 points at 1,396.083 on volume of 1.24 billion shares valued at 2.03 trillion rupiah ($223.20 million).

WELLINGTON: Share prices closed 0.44 per cent higher, sparked by the power sector after the government signalled an easing of electricity price regulations.

The NZX-50 index was up 15.5 points at 3,565.36 on a turnover worth 118.98 New Zealand (US$73.73 million).

MUMBAI: Share prices closed up 1.87 per cent led by Asian markets which gained on expectations that the US Federal Reserve may pause in raising interest rates.—AFP