Open

Coming up

Don't miss

Replay


LATEST SHOWS

DEBATE

Europe's Plan for Putin - Will Russian Leader Bend After New Sanctions? (part 2)

Read more

DEBATE

Europe's Plan for Putin - Will Russian Leader Bend After New Sanctions?

Read more

FOCUS

Pakistan's Ahmadis living in fear of extremist attacks

Read more

WEB NEWS

Web users show solidarity with Iraqi Christians

Read more

THE INTERVIEW

Gilles Kepel, Islamic and Arab world specialist

Read more

BUSINESS DAILY

Argentina braced for another debt default

Read more

DEBATE

Too Late for Sanctions? Pressure Mounts on Russia over Ukraine (part 2)

Read more

DEBATE

Too Late for Sanctions? Pressure Mounts on Russia over Ukraine

Read more

MEDIAWATCH

'What would you do?'

Read more

  • US and EU slap Russia with fresh sanctions over Ukraine

    Read more

  • Scores killed as Israel ramps up Gaza bombardment

    Read more

  • 24 killed in stampede at Guinea rap concert

    Read more

  • Prosecutor says captives were killed to harvest their organs

    Read more

  • Graphic: Ebola spreads across West Africa

    Read more

  • Islamists seize key Benghazi army base as fuel fire rages on

    Read more

  • In pictures: ن - a sign of support for Iraq’s persecuted Christians

    Read more

  • Calls mount to ban France’s ‘violent’ Jewish Defence League

    Read more

  • Venezuela: Hugo Chavez’s ‘little bird’ strikes again

    Read more

  • France extradites suspected Jewish Museum shooter to Belgium

    Read more

  • Video: How tourism is helping Rwanda’s gorillas, ex-poachers

    Read more

  • Rare Sri Lankan leopard cubs born in French zoo

    Read more

  • US says Russia violated arms treaty by testing cruise missile

    Read more

  • Argentina in last-ditch effort to avert default

    Read more

Business

Asian stocks edge up after Wall Street rebound

Latest update : 2009-02-25

Asian markets bounced back on Wednesday, spurred by a late surge on Wall Street. Investors continued to shun the yen, however, amid growing fears about Japan's political troubles and stalling economy.

Reuters - Asia stocks edged up on Wednesday as reassuring comments from Federal Reserve Chairman Ben Bernanke sparked a rebound in battered financial shares, while the yen slid further on Japan's mounting economic and political troubles.

 

Safe-haven government bonds retreated as investors shifted funds into riskier assets, while gold steadied after having soared in the past few weeks on mounting fears about the financial health of countries trying to contain the crisis.

 

Bernanke said the government did not have plans to nationalise major banks at this stage, remarks that put to ease some worries that the largest U.S. banks may need to be taken over because of huge hits to their balance sheets from the global credit crisis.

 

The yen hit a three-month low beyond 97 to the dollar as investors have turned against Japan on the country's deepening recession that is the worst among major economies, forcing hedge funds and other market players to unwind bets favouring the yen.

 

Data showed Japanese exports plunged a record 45.7 percent in January from the previous year, pointing to another sharp contract in economic activity in the first quarter of the year.

 

But Japanese shares were helped in part by reports that the government may start directly buying stocks to support the market and ease the strain on the country's big banks, whose large equity portfolios have suffered heavy losses.

 

"It's good news, but what the market really wants is large-scale economic measures with the Japanese economy having deteriorated the most among developed countries," said Takahiko Murai, general manager of equities at Nozomi Securities in Tokyo.

 

Jc, holding off a 26-year low struck last October. The MSCI index of Asia-Pacific shares outside Japan was up 1 percent after hitting a three-month low earlier in the week.

 

The gains lagged a 4 percent jump in the U.S. S&P 500 on a surge in financial shares.

 

Investors showed little reaction to U.S. President Barack Obama saying he has identified $2 trillion in costs that can be cut over the next decade as he seeks to offset big fiscal spending aimed at reviving the economy.

 

Analysts said there were also technical reasons for the gains in stocks and yen slide.

 

The S&P 500 has held above its intraday lows touched last November that suggested the near-term downside may be limited, while the yen's fall took its through chart levels that spurred further selling.

 

The dollar climbed along with most major currencies against the beleaguered yen. The dollar struck a three-month peak of 97.20 before slipping back to 96.95 yen up 0.3 percent on the day.

 

On Tuesday the dollar broke through a series of chart resistance levels -- including the low of 95.70 struck in March last year and the 38.2 percent retracement of its slide between August and January.

 

The yen's fall even as stocks have slid has broken down one of the key correlations driving markets over the past year or so -- falling stocks spurring a drop in higher-yielding currencies against the yen as carry trades are unwound.

 

Traders have said the change suggests that many such carry trades -- using the low-yielding yen to buy higher-yielding currencies or assets -- have largely been unwound.

 

Gold was up $1.85 an ounce at $964.05 but has retreated from 11-month highs above $1,000 hit last week as some safe-haven buying has ebbed and investors booked profits.

 

Oil was little changed at $39.93 a barrel after climbing 4 percent the previous day along with the rebound in equity markets.

 

In government bonds, the benchmark 10-year Japanese yield rose 2.5 basis points to 1.290 percent but has held in a tight range around 1.25 percent and 1.30 percent over the past two weeks.

Date created : 2009-02-25

COMMENT(S)