Tokyo: Asian shares rose on Monday after Greece requested emergency aid and as a raft of US data showed its economic recovery was gathering strength.
Greece’s finance minister said on Sunday aid from the EU and IMF would arrive in time to avert what would be the eurozone’s first sovereign debt default, although there were growing signs that a €45 billion ($60 billion) rescue package would have to be bigger.
The MSCI index of Asia-Pacific shares outside Japan rose about 1.2%. The index is up more than 4% so far this year.
Japan’s Nikkei average jumped 2.3% as worries about Greece receded and companies such as copier and printer firms benefited after strong earnings from US peers.
Monday’s rally marked the biggest daily percentage gain since late February and saw the Nikkei recoup last week’s 1.7% fall.
“There does seem to be a lessening in risk aversion after Wall Street’s performance on Friday, but whether this is sustainable remains to be seen,” said Nagayuki Yamagishi, a strategist at Mitsubishi UFJ Securities.
“It appears that Greece is getting aid, but whether this is the ultimate solution is a big question. Also, investors may be reluctant to buy the Nikkei much ahead of results later this week.”
Ricoh and Konica Minolta Holdings gained after US rival Xerox Corp’s results and outlook beat expectations on improving corporate demand for printing and document-managing services.
Canon Inc gained as the company raised its annual outlook closer to market expectations after robust demand for digital cameras and printers powered up its quarterly profit by more than fourfold.
US data on Friday also underscored that the world’s largest economy was continuing to gather strength, buoying investor sentiment.
New US home sales rose at their fastest pace in 47 years in March and new orders for durable goods grew strongly, helping US stocks to a 19-month high.
Hong Kong shares gained 1.6% as investors scooped up battered property developers.
Market turnover, however, totalled HK$56.7 billion ($7.3 billion), the lowest since 10 March and down from Friday’s HK$63.2 billion.
“This is not really a rally because market turnover is quite low. This is just bargain-hunting and short-covering after the Hang Seng Index lost more than 600 points last week,” said Francis Lun, general manager at Fulbright Securities.
Shanghai stocks, however, lost half a percent, closing at the lowest in more than two months, weighed down by banking and property stocks as investors reacted to Beijing’s moves to cool the real estate market.
The index extended a nearly 5% drop last week, the largest weekly fall in five months after the announcement of measures to rein in property speculation.
“Investors are not daring to do much today in terms of volume and are waiting for more clarity over regulations in the property sector,” said Ren Chengde, analyst at Galaxy Securities.
“There is still a great deal of uncertainty as to whether new tightening measures will be introduced and the feeling is there are still new measures to come.”
Shares in South Korea ended up 0.9% at a new 22-month closing high, fueled by gains in key blue-chip exporters and banking issues including KB Financial Group.
“Sentiment is very positive on the back of robust foreign buying and a strong finish on Wall Street was also encouraging,” said Wong Sang-pil, a market analyst at Tong Yang Securities. Foreign investors were buyers of a net 203.3 billion won ($183.4 million) worth of stocks.
Taiwan stocks had their best one-day percentage gain in almost six weeks, closing up 1.9%, boosted by hopes a key free trade pact with China was closer to being signed following comments by Taiwan’s President.
Taiwan urgently needs the trade deal, or the economic cooperation framework agreement (ECFA), to save its $390 billion economy from pariah status, Ma Ying-jeou said in a landmark TV debate on Sunday with the opposition.
“Ma’s comments reassured investors the signing of the ECFA will be on schedule around May or June,” said Yu Ray-ming, chief investment officer of Prudential Financial in Taiwan.
The trade deal will result in much lower tariffs for a raft of Taiwan goods sold in China, and hopes for its signing have buoyed financial markets.
Shares in Singapore and India gained less than half a percent.
The yen faltered against commodity-linked and higher-yielding currencies on expectations for global recovery, with the Canadian dollar hitting its highest since October 2008 and the Australian dollar rising to a 19-month high.
Australian markets were closed.
The euro fell as uncertainty persisted over how and when Greece would get financial aid to avert a potential sovereign debt default.
Gold eased as the euro weakened against the dollar, but lingering concern over Greece’s fiscal health supported the metal near $1,155 an ounce, as it boosted its appeal as a haven from sovereign risk.