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Asian stocks rally on economic recovery hopes

Asian stocks rally on economic recovery hopes
AFP
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First Published: Mon, Jan 05 2009. 08 57 AM IST
Updated: Mon, Jan 05 2009. 08 57 AM IST
Tokyo: Asian stocks rose on Monday, with Tokyo hitting the highest level for almost two months as investors hoped that the US economy would start to recover this year after a dire 2008.
Investors took their cue from Wall Street, where shares soared on Friday on expectations that US president-elect Barack Obama’s massive stimulus plan would help to revive the recession-hit economy.
Tokyo’s Nikkei-225 index closed 2.07% higher in a half day of trading, its first of 2009, ending above the 9,000-point level for the first time since 10 November.
Elsewhere in early trade, stocks climbed 2.0% in Hong Kong, 1.40% in Shanghai, 2.92% in Taipei, 2.06% in Seoul and 0.6% in Sydney.
“Stocks are gaining support from the stronger stock market in the United States and expectations of a recovery in the US economy this year,” said Makoto Sengoku, a market analyst at Tokai Tokyo Securities.
A weaker yen gave a boost to Japanese exporters, which have been hit hard by the recent strength of the Japanese currency, he said.
Dealers said they were also encouraged to buy shares as fears of a collapse of the US auto industry receded after the US government approved a financial rescue package in December.
Stock markets in the United States, Europe and much of Asia rose sharply on Friday on hopes for a brighter year ahead after a horrendous 2008 that saw Wall Street’s Dow Jones index plunge 33.84%, the worst loss since 1931.
The Dow Jones Industrial Average surged 258.30 points, or 2.94%, Friday to finish at 9,034.69.
Obama, who takes office on 20 January, has already pledged stepped-up efforts to revive the moribund economy in the face of the worst global financial crisis since the Great Depression.
But there were worries about how long the New Year rally would last.
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First Published: Mon, Jan 05 2009. 08 57 AM IST
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