Asian stocks rally after Wall Street gains

TOKYO — Asian stock markets followed Wall Street sharply higher on Tuesday, invigorated by fresh hopes for improved bank earnings and signs the regional economy is recovering.

By (AP)

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Published: Tue 14 Jul 2009, 1:17 PM

Last updated: Thu 2 Apr 2015, 7:36 AM

The upbeat mood permeated the entire region, with financial stocks leading the gains. Oil climbed back above $60 a barrel after dropping sharply over the past week on concerns about weak global growth.

Japan’s benchmark Nikkei 225 stock average rose 184.26 points, or 2 percent, to 9,235.50, erasing most of the previous day’s decline. Hong Kong’s Hang Seng index advanced 406.38, or 2.4 percent, to 17,661.01 and Australia’s key index was up almost 3 percent.

Encouraging economic news propelled Singapore’s main index up 1.7 percent. The island’s export-dependent economy grew for the first time in a year in the second quarter, according to preliminary figures, suggesting the region is emerging from the global slump.

Singapore’s Trade and Industry Ministry said it now expects the economy to shrink between 4 percent and 6 percent this year, better than its previous forecast of a contraction between 6 percent and 9 percent.

The figures added to optimism following a strong showing overnight in New York, where the Dow Jones industrials jumped more than 2 percent.

Rising bank stocks propelled U.S. indexes to their biggest one-day gain in six weeks Monday after influential banking analyst Meredith Whitney raised her rating on Goldman Sachs Group Inc. The bank reports earnings on Tuesday.

“Investors were looking for buying cues,” said Seiichi Miura, an equity strategist for Mitsubishi UFJ Securities in Tokyo. “So the gains overnight on Wall Street and the positive comments about Goldman Sachs provided that incentive.”

Miura said further moves will depend on second-quarter results this week from Goldman and other financial giants — Bank of America, JPMorgan Chase & Co., and Citigroup Inc. — as well hundreds of earnings reports from other sectors.

Financial stocks throughout the region climbed, with Nomura Holdings Inc., Japan’s biggest securities company, surging 7.3 percent. Chinese brokerage Haitong Securities Co. gained 1.3 percent, and DBS Group Holdings Ltd. of Singapore advanced 2.3 percent.

Japanese automakers were also higher after the Nikkei financial daily reported that Nissan Motor Co. and Honda Motor Co. are boosting production capacity in China. Nissan surged 7.5 percent, and Honda was up 2.7 percent.

In New York overnight, the Dow rose 185.16, or 2.3 percent, to 8,331.68. The broader Standard & Poor’s 500 index jumped 21.92, or 2.5 percent, to 901.05, its first finish over the 900 mark since July 1. It was the S&P’s best day since June 1.

Wall Street futures pointed to modest gains Tuesday. Dow futures were up 10, or 0.1 percent, at 8,269 and S&P futures rose 2.2, or 0.3 percent, at 897.80.

Oil prices climbed Tuesday in Asia, with the benchmark crude for August delivery up 57 cents to $60.26 a barrel. The contract fell 20 cents to settle at $59.69 on Monday.

The dollar strengthened to 93.16 yen from 92.97 yen late Monday, while the euro traded slightly higher at $1.3982 from $1.3976.

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