Overnight Markets: Asian equities buoyant on positive US capital goods data

Asian markets were buoyant on Monday after surge in US capital-goods orders bolstered hope exports to the world’s largest economy will increase.

The MSCI Asia Pacific Index jumped 1.1% to 127 - a five-month high - as of 11:32 a.m. in Tokyo. Japan’s Nikkei 225 Stock Average gained 1% and South Korea’s Kospi index rose 0.5%. Australia’s S&P/ASX 200 Index climbed 1.4%.

Investors were cheerful after Wall Street jumped on a 4.1% rebound in the orders for capital equipment last month following a 5.3% decline in July. The median forecasts of 11 economists, surveyed by Bloomberg, was for an increase of 3%.

In company news, Komatsu, the world’s No. 2 maker of construction equipment, surged 3.2% in Tokyo, while Canon gained 2.4%. BHP Billiton advanced 1.6% in Sydney.

Wall Street, after notching its fourth week of gains on Friday, will watch manufacturing and personal income data due out on Friday for further clues on whether the economic recovery is still on track.

The Institute for Supply Management's manufacturing index probably dropped to 54.5 this month from 56.3 in August, according to a Reuters poll of economists, due probably to tepid demand amid high US unemployment rate. A Commerce Department report on personal income and spending is also expected show moderate gains.

The Conference Board's consumer confidence index is scheduled for release tomorrow, followed by the Thomson Reuters/University of Michigan's final September reading on its consumer sentiment index on Friday.

The final data on second-quarter GDP will be released on Thursday, with the Reuters poll estimating an annual rate of 1.6%.

European stocks gained last week on optimism that the economic recovery will continue, while central banks assured they stand ready to take steps should growth falter. This week, a deluge of data will determine the direction of markets.

The surveys of purchasing managers in the UK and Europe are set to be released on Friday. The final reading of eurozone September PMI is likely to confirm the flash estimate of a 1.5-point decline to 53.6.

Further shaping investor sentiment worldwide, China will unveil its September manufacturing survey on Wednesday. Japan’s quarterly Tankan survey of business sentiment is expected to show improving confidence for large companies but unchanged conditions for smaller businesses.