Asian stocks rebound as US recovery doubts ease

PAMELA SAMPSON
A man looks at an electronic stock indicator in Tokyo, Tuesday, April 16, 2013.  Asian stock markets were mostly lower Tuesday as weak economic data, falling commodity prices and big losses on Wall Street shook investors. A deadly bombing in the U.S. also rattled confidence.(AP Photo/Shizuo Kambayashi)
A man looks at an electronic stock indicator in Tokyo, Tuesday, April 16, 2013. Asian stock markets were mostly lower Tuesday as weak economic data, falling commodity prices and big losses on Wall Street shook investors. A deadly bombing in the U.S. also rattled confidence.(AP Photo/Shizuo Kambayashi)

BANGKOK (AP) — Asian stock markets rose Wednesday, boosted by a strong U.S. housing report and better-than-expected corporate earnings that eased doubts about the strength of the recovery in the world's No. 1 economy.

U.S. builders started construction on 1 million homes last month, the highest level since June 2008, the Commerce Department reported Tuesday. The government also said consumer prices declined last month as the cost of gas fell sharply while food prices were unchanged, the latest evidence that inflation is in check.

On the corporate side, robust quarterly earnings provided additional reason to wade back into stocks. Coca-Cola, the world's biggest beverage maker, reported first quarter earnings that beat Wall Street forecasts. As of Monday, 34 companies in the Standard & Poor's 500 had reported earnings and 20 had exceeded analysts' expectations.

Japan's Nikkei 225 rose 1 percent to 13,358.81. Hong Kong's Hang Seng swung between gains and losses to flatten out at 21,661.08.

Australia's S&P/ASX 200 added 0.9 percent to 4,994.70. Benchmarks in Singapore, Indonesia and the Philippines also rose. But South Korea's Kospi slipped 0.1 percent to 1,920.40 as tensions lingered on the Korean Peninsula.

Analysts at DBS Bank Ltd. in Singapore suggested the U.S. housing data was not all that spectacular, since it reflects a big jump not in single family homes but in apartment construction, which is typically volatile.

"Still, you'd have to say it was a good day for data, especially in light of what's been seen over the past three weeks," DBS said, referring to weak hiring, manufacturing and retail sales reports that had suggested the U.S. economy was cooling.

Investors chose to put aside the International Monetary Fund's dour assessment of global growth. The IMF on Tuesday said it was lowering its outlook for the world economy this year, predicting that government spending cuts will slow U.S. growth and keep the euro currency countries in recession. The international lending organization cut its forecast for global growth to 3.3 percent this year, down from its January forecast of 3.5 percent.

Lorraine Tan, director at Standard & Poor's equity research in Singapore, said investors mostly regarded the IMF's initial numbers as too optimistic. Thus the lowering of its global growth outlook didn't sting all that much.

"Global growth is continuing to move along. That should be a positive," Tan said.

Among individual stocks, Japan's Komatsu rose 2 percent after the heavy machinery maker said it will start selling automatic bulldozers in North America in June, Kyodo News reported. Mazda Motor Corp. jumped 4.9 percent.

Wall Street rebounded Tuesday after its worst day so far this year. The Dow Jones industrial average rose 1.1 percent to close at 14,756.78. The S&P 500 index rose 1.4 percent to 1,574.57. The Nasdaq composite rose 1.5 percent to 3,264.63.

European markets posted further declines Tuesday in the wake of a downbeat investor survey for Germany. The closely watched ZEW index fell from 48.5 points to 36.3 in April in a sign of growing investor fears over the strength of the German recovery amid widespread debt problems in Europe.

Oil prices flattened out after some wild swings. Benchmark oil for May delivery was down 2 cents to $88.70 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 1 cent to close at $88.72 on the Nymex on Tuesday.

In currencies, the euro fell to $1.3175 from $1.3188 late Tuesday in New York. The dollar rose to 98.23 yen from 97.44 yen.

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