Shanghai: Most Asian and European markets rose modestly on Wednesday after an overnight surge on Wall Street, while Tokyo shares were buoyed by fresh support for the wobbly financial system from the Japanese central bank.
Hong Kong’s Hang Seng index led the region, gaining 239.08 points, or 1.9%, to 13,091.03, while in Tokyo the Nikkei 225 added 23.04 points, or 0.3%, to 7,972.17.
The Japanese central bank said it was increasing its purchase of government bonds to keep ample cash in the monetary system following a two-day meeting where it also decided to keep its key interest rate at 0.1%. The Bank of Japan also said it was considering providing loans to commercial banks to shore up their capital bases.
“Investors took heart from the bank’s moves. The Bank of Japan is not sitting still. It is taking action aggressively to ensure the smooth liquidity in the financial market,” said Masatoshi Sato, a strategist at Mizuho Investors Securities Co. Ltd.
South Korea’s Kospi rose 0.5% to 1,169.95, while Shanghai’s benchmark Composite Index added 0.2% to 2,223.73. Australia’s benchmark S&P/ASX 200 dipped 0.2% after miner Rio Tinto dropped 8.7% on worries over its deal with Aluminum Corp. of China.
In Europe, Britain’s FTSE 100 dipped 0.1%, while Germany’s DAX rose 1.2% and France’s CAC 40 advanced 0.8%. Wall Street got a surprise boost on Tuesday, posting its fifth gain in six trading sessions, from a government report that home construction picked up in February. The news, which was unexpected, injected new vitality into a week-old rally.
Asian markets also have advanced strongly in recent sessions on signs of improvement among major US and European banks. Many analysts believe the rally has run its course for now.
“The rebound has almost reached its limit,” said Castor Pang, an analyst at Sun Hung Kai Financial in Hong Kong, noting that turnover in most markets is not rising quickly enough to suggest a recovery.
Joe McDonald in Beijing, Shino Yuasa in Tokyo and Ji Chen in Shanghai contributed to this story.