- Category: Economic
- Published Monday, January 25, 2016
- CTV News
TOKYO - Asian stocks rose Monday as oil rebounded from 12-year lows and expectations of monetary stimulus in Europe and Japan shored up sentiment after a three week sell-off in global markets.
KEEPING SCORE: Japan's Nikkei 225 rose 1.4 per cent to 17,194.40 and Hong Kong's Hang Seng jumped 1.9 per cent to 19,442.79. The Shanghai Composite Index climbed 1.2 per cent to 2,950.54 and Australia's S&P/ASX 200 rose 1.5 per cent to 4,991.90. South Korea's Kospi was up 1 per cent at 1,897.42, and shares in Taiwan, New Zealand and Southeast Asia also were higher.
WALL STREET: Investors were encouraged by a 9 per cent jump in U.S. crude on Friday, which was partly related to a massive winter storm, but handed U.S. shares their biggest single-day gain in more than a month. That advance, combined with a smaller increase the day before, gave the market its first weekly gain after three weeks of declines. The Dow Jones industrial average rose 210.83 points, or 1.3 per cent, to 16,093.51 and the Standard & Poor's 500 index gained 37.91 points, or 2 per cent, to 1,906.90. The Nasdaq composite index made its biggest gain since September, adding 119.12 points, or 2.7 per cent, to 4,591.18.
ECB BOOST: On Friday European Central Bank head Mario Draghi said the bank has a lot of options to boost inflation and is determined and willing to act. On Thursday Draghi suggested the ECB will consider more stimulus action at its next meeting in March. The signals from Europe also spurred expectations that the Bank of Japan would consider adding to its already lavish stimulus.
ANALYST'S VIEWPOINT: "Markets look set for a solid day in Asia after the ECB-fuelled two-day rally last week," Angus Nicholson of IG said in a commentary. But he added that the "two major unknowns in the oil market have not yet reached their denouement: the rate of new Iranian output and China's slowdown concerns."
JAPAN TRADE: Trade data for December released Monday showed exports fell for three straight months though imports fell at a faster pace thanks to the collapse in oil prices. The December trade surplus of 140.2 billion yen ($1.2 billion) compared with a deficit of 379.7 billion yen in November and a deficit of 665.6 billion yen in December 2014. But share prices have rebounded on speculation that the prolonged weakness in demand may lead the central bank to opt for further monetary easing at a two-day policy meeting that starts Thursday.
OIL PRICES: U.S. crude gained 16 cents to $32.35 per barrel in electronic trading on the New York Mercantile Exchange. On Friday, it crude shot up $2.66 to $32.19 a barrel in New York. Brent crude, a benchmark for international oils, added 19 cents to $32.37 a barrel. It gained $2.93, or 10 per cent, on Friday to $32.18 a barrel in London.
CURRENCIES: The dollar edged down to 118.67 yen from 118.79 yen on Friday. The euro rose to $1.0813 from $1.0799.