Investing.com – Asian stocks rose during thin trading on Tuesday as the Japanese corporate service price index rose more than expected and the investors prepared for the lunar holiday.
Released by Bank of Japan on Tuesday, December’s year-on-year corporate service price index rose by 1.3% as against the expectation of a gain of 1.1%. The previous gain was 1.2%.
Singapore to China and Hong Kong and Taiwan are gearing up for the coming holiday weekend, with the marking of Lunar New Year on Friday, and market closures across many parts of the region.
BoCom rose 1.3%, CCB was up 0.3% and China Merchants Securities rose 1%.
Hong Kong's Hang Seng Index rose 0.15%, China’s Shanghai Composite index rose 0.08%, while Japan’s Nikkei 225 Index was up 0.21%.
On Monday U.S. stocks fell amid ongoing fears that emerging-market economies are due to hit a soft patch, while uncertainty over the Federal Reserve's stimulus program also nudged prices lower.
Fears emerging markets are due to cool, especially if the Federal Reserve continues to taper stimulus programs, sent stocks worldwide falling on Monday, with fears that contagion from Turkey and Argentina could spread elsewhere fraying nerves even further.
The Federal Reserve will conclude a monetary policy meeting on Wednesday, and investors held firm on expectations that monetary authorities will make fresh cuts to its USD75 billion in monthly bond purchases due to several months of improving U.S. economic indicators.
Stimulus tools such as Fed purchases of Treasury holdings and mortgage debt suppress interest rates to spur recovery, thus sending investors to asset classes like stocks in industrialized and emerging markets.
While talk of tapering the program reflects a view that the economy is improving, it also creates uncertainty as to how stocks will react without a monetary crutch.
Elsewhere, the Census Bureau reported earlier that sales of new, single-family houses in December came in at a seasonally adjusted annual rate of 414,000, missing market calls for a 475,000 reading and also below November's revised figure of 445,000.
The figure was still well above the December 2012 reading of 396,000, and the data also revealed that inventories remain lean and prices continue rising.
Harsh winter weather may have affected sales in December as well.
Later today, the U.S. is to release data on durable goods orders, a leading indicator of production, as well as what will be a closely watch report on consumer confidence.