Asian stock markets climb as Japan central bank calls unscheduled meeting, eases policyBy AP
Sunday, August 29, 2010
Asian shares rise as Japan eases monetary policy
BANGKOK — Asian markets advanced Monday, boosted by Japan easing monetary policy to protect a shaky recovery and the Federal Reserve vowing to take action if the U.S. economy weakens further.
The willingness of major central banks to take more action to prevent a slide back into recession reassured investors who have been unnerved the past month by evidence from the U.S. to China that suggests the economic recovery is running out of juice.
But the optimism could be short-lived if economic indicators due this week show the slowdown is becoming entrenched. U.S. indicators this week include figures on services, manufacturing and employment.
In Tokyo, the Nikkei 225 stock average was up 140.32 points, or 1.6 percent, to 9,131.138 after the Bank of Japan decided at an emergency board meeting to further ease monetary policy by expanding a low-interest loan program for financial institutions to 30 trillion yen ($355 billion) from 20 trillion yen.
The central bank has been under growing political pressure to take action on the strong yen, which is hurting exporters and undermining a faltering economic recovery. Later in the day, Prime Minister Naoto Kan is also expected to announce a framework for additional economic stimulus measures.
News of the BOJ meeting initially sent the Nikkei higher by 3.1 percent.
South Korea’s Kospi rose 1.6 percent to 1,756.79 and the Shanghai Composite index added 1.5 percent to 2,648.40. Australia’s S&P/ASX 200 gained 1.6 percent to 4,441.50 as commodity stocks posted healthy gains. Australian miner Rio Tinto Ltd. was up 2.5 percent.
Markets in India, Taiwan, Singapore and Indonesia also gained.
Sentiment in Asia was bolstered by big gains in New York on Friday.
The Dow Jones industrial average rose 164.84, or 1.7 percent, to close at 10,150.65 after Federal Reserve Chairman Ben Bernanke said the central bank was ready to step in if the U.S. economy showed further signs of weakening.
The Standard & Poor’s 500 Index rose 17.37, or 1.7 percent, to 1,064.59 and the Nasdaq composite index rose 34.94, or 1.6 percent, to 2,153.63.
In currencies, the dollar rose to 85.34 yen from 85.21 yen late Friday in New York. The euro fell to $1.2732 from $1.2761.
Benchmark crude for October delivery was down 2 cents at $75.15 a barrel in electronic trading on the New York Mercantile Exchange. The contract jumped $1.81 to settle at $75.17 per barrel on Friday.
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