Asia Stocks Rise as China Growth Buoys Confidence

An investor looks at the share index at a bank in Kuala Lumpur, Malaysia, Thursday, July 16, 2009....

An investor looks at the share index at a bank in Kuala Lumpur, Malaysia, Thursday, July 16, 2009. Asian stocks jumped Thursday after China's economic growth quickened and U.S. companies posted stronger-than-expected results, boosting faith in a global recovery. The benchmark FTSE Bursa Malaysia KLCI went up 19.32 points or 1.76 percent to 1,116.56. (AP Photo/Lai Seng Sin)

(AP)

Asian stocks jumped Thursday after China's economic growth quickened and U.S. companies posted stronger-than-expected results, boosting faith in a global recovery. European shares lagged in early trade.

The move higher in Asia followed a rally on Wall Street and marked the region's third straight day of gains after a string of losses amid anxiety the market had overestimated the economy's prospects and earnings season would disappoint.

But worst-case fears about U.S. earnings haven't played out, at least not yet.

Intel Corp., the world's biggest chipmaker, helped confidence with results that topped expectations and a robust outlook for the second-half of the year. The news came after Goldman Sach Group Inc.'s quarterly profit comforted investors the day before.

China, meanwhile, said its economy accelerated in the second quarter, expanding by 7.9 percent, amid a surge in consumer spending and factory output on the back of massive government stimulus measures.

Analysts said the quicker expansion, above most market forecasts, put the world's third-largest economy within reach of the government's 8 percent full-year growth target. It offered yet more assurances for global investors who, thrilled by China's ability to keep its economy growing as other countries slump, have already driven Shanghai's stock market up nearly 75 percent this year.

"This should give people confidence that China's economy is on strong footing and that there are a lot better days ahead," said Alan Landau, Hong Kong-based president of Marco Polo Pure Asset Management, which oversees about $120 million in mostly mainland Chinese equities.

"All the signs point to expansion in China. Sentiment is very positive toward China. Where else in the world right now can you find that kind of growth?"

Early going in Europe, benchmarks in Britain and Germany were off about 0.3 percent, with France's index down about 0.1 percent. U.S. futures pointed to losses Thursday: Dow futures were down 35, or 0.4 percent, at 8,508 and S&P futures were off 3.9, or 0.4 percent, at 923.30.