Exports fillip sparks Tokyo rally

ASIAN markets held firm today as the world prepared to mark the first anniversary of the terrorist attacks on New York and Washington. Recent jitters about possible further atrocities and the damaging impact of an attack on Iraq faded as investors took their lead from firm overnight performances on Wall Street and Nasdaq.

Tokyo stocks scored gains for the third day in succession, after Japan's economy showed better-than-expected growth in the second quarter, and the Nikkei 225 index added 90.77 to 9400.08. Revised figures for the three months to the end of June showed Japan's gross domestic product rose 0.6%, compared with an earlier government estimate of 0.5%, and was the first quarterly expansion in 20 months. This translated into annual growth of 2.6%, up from 1.9%, but few analysts were impressed by the revision, which was powered by stronger-than-expected capital investment and buoyant

Since the end of June data showing a worrying weakening in spending by big manufacturers has put a question mark over the sustainability of Japanese growth throughout the rest of the year.

A further weakening of the yen lifted stocks of leading exporters. They were also supported by heavy short covering by foreign institutions, which have been selling the market down for two months. Ministry of Finance figures showed net sales by foreigners in August were 133bn yen (£713m).

Tokyo trading centred on export leader Sony Corporation, and its shares rose more than 3%. Continued strength in US automobile sales, coupled with the favourable moves in the yen, lifted shares in Toyota and Nissan by more than 2%. Japanese chipmakers also did well following reports of strong sales from their Taiwanese rivals earlier this week, and gains reached up to 6%.

An early attempt at a rally after Wall Street's gain soon faded in Hong Kong, and an approaching cyclone closed the stock market at lunchtime. The Hang Seng index lost 3.42 at 9882.35.

The low turnover did not rescue telecoms operator PCCW from another bad session and the shares dropped more than 2% after controlling shareholder Pacific Century Regional Development reported first-half losses. PCCW, down 40% this year, is firmly fixed as Hong Kong's worst-performing blue-chip.

Wall Street set the pace in South Korea, as fears over 11 September reactions were overcome by an urge to seek out bargains among local blue-chips, and the Kospi added 10.08 to 723.38.

Taiwan stocks were marginally ahead despite mixed news on sales and production among its chipmakers, contradicting the evidence of stronger demand from market leader Taiwan Semiconductor earlier this week. The Weighted Average rose 3.55 to 4671.56.

Sydney investors took their lead from New York and the All Ordinaries bounced up 34.1 to 3094.7, led by a 4% jump in News Corp, and renewed buying of heavyweight resources stocks.

The Straits Times index in Singapore drifted 0.61 points to 1447.27 and Kuala Lumpur's Composite dipped 0.99 to 686.83. Thailand's SET added 0.60 to 361.21 but the Jakarta Composite slipped 2.77 to 426.56.

Prices and indices in this section are supplied from various sources and calculated at different times and may not always match those listed in the tables.