World shares up amid better US jobs data, profits

[March 25, 2011]  BANGKOK (AP) -- World shares rose Friday after Wall Street advanced on news of an improving U.S. job market and higher corporate earnings, although an ongoing nuclear crisis in Japan and Western military action in OPEC-member Libya suggested an uneasy road ahead.

European shares rose on the heels of Asian gains. Britain's FTSE 100 rose 0.3 percent to 5,899.11. Germany's DAX was 0.5 percent up to 6,966.42, and France's CAC-40 rose narrowly to 3,971.13. The dollar was up against the yen and the euro. Shares in New York were also headed higher ahead of the opening bell.

Futures augured gains on Wall Street. Dow Jones industrial futures were up 0.3 percent to 12,151 and S&P 500 futures rose 0.3 percent to 1,209.40.

The Nikkei 225 in Tokyo closed up 1.1 percent to 9,536.13 with automakers rising following recent steep losses that resulted from a catastrophic earthquake and tsunami that struck Japan on March 11. The disaster killed at least 18,000 people and all but wiped out the country's northeastern coast, home to a crucial network of auto parts suppliers and plants.

Nissan Motor Co., which lost nearly 5 percent Thursday after saying it may move some engine production to the U.S. because of earthquake damage to a Japanese plant, was up 1.5 percent. Toyota Motor Corp., the world's largest automaker, rose 1.9 percent after being pummeled in prior trading sessions.

Investors pushed up several construction-linked shares, expecting those companies to benefit once Japan begins rebuilding. Komatsu Ltd. rose 4.7 percent a day after announcing that production was resuming in quake-affected areas. Mitsubishi Heavy Industries Ltd. was up 2.3 percent.

Consumer electronics companies also clawed back recent losses with Sony Corp. up 3.3 percent, and Panasonic Corp. up 1.8 percent.

Analysts believe that a coordinated currency intervention earlier this month by the world's top seven industrialized nations aided Japan's exporters by keeping the yen stable.

"There's been a strong rebound in markets after a very savage sell-off after the disasters in Japan," said Tim Schroeders, who helps manage $1 billion at Pengana Capital Ltd. in Melbourne.

Markets were reassured by the central bank intervention that stabilized the yen, he said. The yen hit a record high against the dollar in the days following the quake.

"A level of confidence has been maintained in financial markets during an extremely volatile time," Schroeders said.

Still, Japan continued to grapple with an avalanche of post-quake miseries, including its ravaged Fukushima Dai-ichi nuclear power plant. Two weeks after the disaster, officials were still struggling to stop radiation leaks that have already contaminated the air, the sea, food and even Tokyo tap water.

While a complete nuclear meltdown was avoided, Japanese companies still face a myriad of challenges in resuming normal output: rolling electricity blackouts, the possibility of aftershocks, anxiety over elevated levels of radiation, and restrictions on Japanese food products from the region affected by radiation. The Nikkei has lost 7 percent since the quake.

"Given the host of unprecedented issues, including ongoing nuclear plant problems, a power shortfall, and supply chain bottlenecks, we think the market will continue to be highly volatile," said Citigroup Global Markets said in a report.

Elsewhere, the Hong Kong's Hang Seng index rose 1.1 percent to 23,158.67 and South Korea's Kospi moved 0.9 percent higher to 2,054.04, with investors snapping up high-tech shares. Samsung Electronics Co. Ltd. jumped 3.4 percent, Hynix Semiconductor Inc. was up 2.8 percent, and LG Electronics rose 1 percent.

Australia's S&P/ASX 200 rose 0.9 percent to 4,742.60. Among gainers were mining giants Rio Tinto Ltd., up 0.5 percent., and BHP Billiton Ltd., up 0.1 percent after it announced a nearly $10 billion expansion to its iron ore and coal operations.

On Wall Street late Thursday, stronger corporate earnings and signs of a stronger job market lifted stocks. The U.S. government said fewer people applied for unemployment benefits last week, evidence that layoffs are slowing. The average number of unemployment filings over the last four weeks has dropped to its lowest level since July 2008.

Software company Red Hat Inc., chip maker Micron Technology Inc. and Chef Boyardee maker ConAgra Foods Inc. all reported profits that beat expectations. Earnings growth has been strong across U.S. companies, which are benefiting from lower costs and higher revenue overseas.

The Dow Jones industrial average rose 84.54 points to close at 12,170.56. The Standard & Poor's 500 index rose 12.12 to 1,309.66. The Nasdaq composite index rose 38.12 points to 2,736.42.

Oil prices were up 10 cents to $105.70 a barrel as upheaval in the Middle East and signs of strong global demand kept crude near two-year highs. Benchmark crude for May delivery fell 15 cents to settle at $105.60 per barrel on the New York Mercantile Exchange on Thursday.

Crude prices have jumped 25 percent since anti-government protests in Libya that began last month shut down most of the OPEC nation's crude output. Western-backed military operations have pounded Libyan strongman Moammar Gadhafi's forces to prevent them from attacking civilians, but rebels have so far been unable to mount an offensive to overthrow the regime.

In currencies, the euro dropped to $1.4148 from $1.4183 late Thursday. The dollar edged up to 81.19 yen from 80.95 yen.

[Associated Press; By PAMELA SAMPSON]

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