Asian market preview 15/05/2008

US markets closed higher last night after a milder-than-expected US inflation data spurred a rally in the equity markets. CPI rose 0.2% in April, after rising 0.3% in the previous month. Investors interpreted this data as a good sign because The Fed will have more room to stimulate the economy. Consumer spending did not rise as much although oil and food prices climbed to its highest. Oil and gold prices also fell last night as Dollar was mixed against major currencies. Some analysts are still pessimistic about the recent gains in the equity markets, saying that recent rallies do not justify that Wall St has conquered its problems and is set for a rebound from months of turmoil because, there's still one sector that's left behind, which is financials. The Dow rose 66.20 pts or 0.51% to 12898.38, after rising more than 150 pts during the day. A late sell-off in tech sector caused market to give up some of its gains. S&P500 rose 5.62 pts or 0.40% to 1408.66 while Nasdaq rose 1.58 pts or 0.06% to 2496.70.

Asian markets may open higher today following better-than-expected US inflation data which means that The Fed still has some breathing space to stimulate the economy. Lower oil prices may also help boost the markets today and gains in Dollar may help exporters rally. Oil was recently traded around $124ish per barrel, gold traded around $864.65ish and JPY traded around 105.04ish. Nikkei futures was closed at 14240 in CME last night compared to the close of 14125 here yesterday.

Kospi may open higher today and may extend yesterday's mild gains on US inflation data. The data may give investors more confident to get back into the equity markets. Seeing how presistent the market is in recent days, it's not possible that the market may test the 242 mark today. Market volatility may be high if investors are choosing to lock in profits when they're in the money.

Hangseng may open higher today and may continue its rebound yesterday. Hangseng may open around 25600ish and may go towards 25800. If it can go beyond, it may test the 26000 level today. However, mainland China markets may come into focus too and if the investors there remain positive, it may help Hangseng to rally further. If Hangseng fall, it may go towards yesterday's low of around 25000. US inflation data and slightly lower oil prices may help boost Hangseng today but not without the fear of profit taking to be done by investors.