1 Jun 2009

Japan market up ahead of GM bankruptcy filing

8:36 pm on 1 June 2009

Japanese share prices rose to an eight-month high on Monday after data showed Chinese manufacturing continued to expand, spurring buying from commodities investors as hopes grew for a global economic recovery.

Sentiment was also lifted as General Motors prepared to file for bankruptcy protection on Monday amid hopes that the former Detroit giant will reemerge from the process as a new, leaner company within 60 to 90 days.

Fellow Big Three automaker Chrysler is expected to soon emerge from bankruptcy protection after just over a month.

Commodities-related shares lead the market after China's Purchasing Managers' Index - a reading on the health of the country's manufacturing sector - indicated growth for a third straight month.

The PMI dropped to 53.1 in May from 53.5 in April, but stayed above the key 50 reading, according to official data. A PMI of more than 50 indicates the industry is expanding.

The benchmark Nikkei-225 index rose 1.63% or 155.25 points to 9,677.75, its highest level since 7 October when it closed at 10,155.9. The broader Topix index of all first section shares also rose 1.63% or 14.61 points, to 912.52.

The Australian share market closed stronger on broad-based gains and a late-buying surge that pushed Macquarie Group more than 11% higher.

At 1615 AEST, the benchmark S&P/ASX200 was up 76.4 points, or 2%, at 3894.4, while the broader All Ordinaries gained 74.6 points, or 1.96%, at 3887.9 points.

Macquarie finished $A3.74 or 11.82% higher at $A35.39, its highest close in three weeks.

The New Zealand share market was closed due to a public holiday.