Follow Us:
Wednesday, January 26, 2022

Asia stocks push towards 6-month highs

Asian shares rose on Friday,with South Korean stocks hitting a 6-month high after the country averted recession in the first quarter,as a Wall Street rally boosted risk demand around the region and dented the yen.

Written by Reuters | Tokyo |
April 10, 2009 1:48:33 pm

Asian shares rose on Friday,with South Korean stocks hitting a 6-month high after the country averted recession in the first quarter,as a Wall Street rally boosted risk demand around the region and dented the yen.

Many financial centres in the region were closed for a long weekend,making investors nervous that gains made now may not be sustained next week when many major US companies report quarterly earnings.

The Nikkei hit a three-month closing high for the second day in a row,though off the day’s peak reached above the psychologically key 9,000 level,as banks tumbled after Sumitomo Mitsui Financial Group warned of a net loss for the financial year just ended,reviving fears for other megabanks.

Nikkei edged up 0.5 per cent to 8,964.11.

US shares rebounded after Wells Fargo said it expected to post a record quarterly profit of $3 billion,topping analyst expectations that sent the sector — key to market sentiment — sharply higher,with the S&P financial index soaring 15.51 per cent.

In Taiwan,this dovetailed with Cathay Financial rallying after it reversed a year-ago loss to report market-beating first quarter profits,helping shares hit a 6-month high.

Taiwan’s main TAIEX share index gained 2 per cent to 5,781.96,while the Korea Composite Stock Price Index (KOSPI) rose 1.5 per cent to 1,336.04.

Seoul shares gained additional upward impetus with a positive growth estimate for the first quarter from South Korea’s central bank.

“The market was helped by Wells Fargo’s stronger than expected first quarter results estimate,fueling hopes of stabilisation in US financial markets,” said Won Jong-hyuck,a market analyst at SK Securities in Seoul.

Global investors have been keenly awaiting US financial results,which move into high gear next week when Goldman Sachs,JP Morgan Chase and Citigroup are all set to report.

“If US banks show some signs of improvements and stabilisation,the index could make a more meaningful rebound. Better numbers from banks will point to stronger economies in the second half,” said Lee Sun-yeob,a market analyst at Goodmorning Shinhan Securities.

But there was little joy for financials in Japan a day after its third-largest bank,Sumitomo Mitsui Financial Group,said it faces a net loss of $3.9 billion for the financial year just ended and would raise as much as $8 billion through the sale of shares.

This revived worries for its larger rivals,seen as even more sensitive to declines in Japanese share prices,with No. 2 bank Mizuho Financial Group tumbling 9.6 per cent.


The MSCI index of Asia-Pacific stocks outside Japan rose 0.5 per cent,back near a six-month peak hit on Monday.

The euro fell to its lowest in almost a month against the dollar,dented by holiday trade and a view the European Central Bank may be edging closer to unconventional easing.

ECB President Jean-Claude Trichet said on Thursday the ECB still had some leeway to cut its main interest rate from its record low of 1.25 per cent.

He repeated it would lay out plans for possible unconventional monetary policy measures at its next meeting in May. He did not give details,but another ECB official said buying debt could ease credit availability.

The dollar initially rose against the yen but fell back in later trade,down 0.1 per cent at 100.35 yen by 0600 GMT.

Japanese government bonds edged up as investor demand for debt revived a little with the market beginning to process news of an upcoming increase in supply.

The benchmark 10-year JGB yield fell 2.5 basis points to 1.450 per cent.

📣 The Indian Express is now on Telegram. Click here to join our channel (@indianexpress) and stay updated with the latest headlines

For all the latest Business News, download Indian Express App.

  • Newsguard
  • The Indian Express website has been rated GREEN for its credibility and trustworthiness by Newsguard, a global service that rates news sources for their journalistic standards.
  • Newsguard