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article imageAsian stocks up for second day on U.S. growth

By AFP     Aug 28, 2015 in Business

Tokyo shares led Asian stock markets higher on Friday after a surprisingly upbeat US economic growth report buoyed investors following a prolonged rout driven by concerns over China's economy.

The dollar gained and oil prices rose on the back of the US growth report, while the yen came under pressure from data showing Japan's inflation was flat last month.

Tokyo stocks finished 3.03 percent, or 561.88 points, higher at 19,136.32, while Shanghai gained 4.82 percent, or 148.76 points, to 3,232.35.

Sydney closed 0.58 percent, or 30.30 points, higher at 5,263.60, and Seoul gained 1.56 percent, or 29.67 points, to finish at 1,937.67.

Traders work on the floor of the New York Stock Exchange during the morning of August 27  2015
Traders work on the floor of the New York Stock Exchange during the morning of August 27, 2015
Andrew Burton, Getty/AFP

Hong Kong was the lone faller, with the benchmark Hang Seng Index dropping 1.04 percent, or 226.15 points, to 21,612.39.

The gains in Asia followed a second straight day of advances on Wall Street, with the Dow Jones Industrial Average gaining 2.27 percent, the broad-based S&P 500 rising 2.43 percent and the tech-rich Nasdaq adding 2.45 percent.

They were boosted by a US economic growth report that showed the world's biggest economy expanded at an annual rate of 3.7 percent in the second quarter, sharply higher than the initial appraisal of a 2.3 percent gain.

"Fear for the global economy had been one reason behind the recent falls, so the unexpected strength in the US, the fact that their GDP has managed to grow this much, is positive," said Nobuyuki Fujimoto, a Tokyo-based senior market analyst at SBI Securities Co.

- Relief for investors -

A pedestrian is reflected on a share prices board in Tokyo on August 26  2015
A pedestrian is reflected on a share prices board in Tokyo on August 26, 2015
Yoshikazu Tsuno, AFP

The gains come as a relief to investors who saw $8 trillion wiped off global markets in just over two weeks in a rout led by fears over the outlook for China.

Oil prices fell back after surging 10 percent in the previous session on the back of the US data.

US benchmark West Texas Intermediate dropped 40 cents to $42.16 while Brent crude fell 53 cents to $47.03.

On currency markets, the dollar was trading around one-week highs against the euro and the yen.

The Japanese currency was also hurt by data showing inflation in the Asian powerhouse fell back to zero in July while household spending dropped for a second straight month.

The disappointing figures stoked speculation the central bank would be forced to unleash more stimulus this year to counter a downturn in the world's number three economy, which contracted in the April-June quarter.

In Tokyo trading, the dollar bought 120.86 yen, from 121.02 in New York and 119.98 on Wednesday.

It was also at $1.1297 against the euro, down from $1.1239 in New York but still stronger than Wednesday's value of $1.1312. The euro bought 136.54 yen, against 136.03 yen in US trading.

Gold, which is seen as a safe haven in times of stock market turmoil, traded at $1,130.38, up from $1,125.00.

In other markets:

Federal Reserve Vice Chair Stanley Fischer speaks during a CNN Debate on the Global Economy  in Wash...
Federal Reserve Vice Chair Stanley Fischer speaks during a CNN Debate on the Global Economy, in Washington, DC, in October 2014
Jim Watson, AFP/File

-- Wellington closed up 0.63 percent, or 35.53 points, at 5,670.48.

Spark rose 1.40 percent to NZ$3.27 and Fletcher Building gained 0.97 percent to end on NZ$7.25.

-- Taiwan rose 2.49 percent, or 194.63 points, to 8,019.18.

Taiwan Semiconductor Manufacturing Co was 0.81 percent higher to Tw$125.0 while Hon Hai Precision Industry gained 4.73 percent to Tw$88.6.

-- Manila closed 1.09 percent, or 76.72 points, higher to 7,098.81.

Top-traded Ayala Land was up 3.30 percent to 35.95 pesos, while Philippine Long Distance Telephone was down 1.33 percent to 2,518 pesos.

-- Bloomberg News contributed to this report --

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