Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday

Asian shares rise after Greek austerity vote

Asian shares rise after Greek austerity vote
Comment E-mail Print Share
First Published: Thu, Jun 30 2011. 09 04 AM IST
Updated: Thu, Jun 30 2011. 09 04 AM IST
Hong Kong: Asian stock markets rose on Thursday morning after Greek lawmakers passed a key package of swingeing cuts that will help Athens avoid a catastrophic default.
The news, which came amid clashes between protesters and police in Athens, also sent the euro higher but investors remained cautious as Greek MPs must still vote on details of the austerity package on Thursday.
Hong Kong rose 1.29%, Sydney added 1.02% and Shanghai put on 0.92% while Seoul surged 1.80%. Tokyo was flat by the break.
The Greek yes vote to the €28.4 billion ($40 billion) in spending cuts unlocks a €12 billion payout from the European Union and the International Monetary Fund.
The cash will help prevent the country defaulting on its massive debts, a situation many had feared could spread to other economies and lead to another global financial downturn.
But there was still caution as dealers, who have been closely following events in Greece, now have their eyes on a second vote on the detail behind the measures on Thursday.
The agreement in Athens boosted the euro, which hit $1.4495 in Tokyo morning trade from $1.4429 in New York late Wednesday. The single European currency was at ¥116.62 from ¥116.61.
The dollar fell to ¥80.42 from ¥80.80.
“Although the vote outcome came in line with expectation, the market is confirming risks to the euro stemming from the Greek debt problem are diminishing step by step,” said Dai Sato, dealer at Mizuho Corporate Bank.
“Upbeat stock markets are also helping improve risk sentiment, lifting the euro against the dollar,” Sato said.
Expectations of a rate hike by the European Central Bank at its policy meeting next week also lifted the euro against the dollar, noted Yuji Saito, foreign exchange market director at Credit Agricole in Tokyo.
US and European stock markets took a cue from the news, with the Dow gaining 0.60%, London’s FTSE 100 soaring 1.54%, Frankfurt’s DAX up 1.73% the CAC in Paris jumping 1.88%.
Oil was mixed after surging on Wednesday after the vote.
New York’s main contract, West Texas Intermediate for delivery in August, climbed 15 cents to $94.92 a barrel in Asia after rising $1.88 on Wednesday.
Brent North Sea crude for August dipped 32 cents to $112.08 after leaping $3.62.
However, while world leaders hailed the vote’s success as common sense, on the streets of Athens anti-austerity protesters fought with police through the day and late into the night.
An estimated 500 to 600 hardcore demonstrators hurled missiles, according to police, who responded with volleys of tear gas that blanketed Syntagma Square in front of the parliament, while a blaze broke out at the finance ministry.
One demonstrator told AFP: “We’re going to carry on the protest until the government falls, and it will fall.”
Gold opened at $1,510.00-$1,511.00 an ounce in Hong Kong, up from its Wednesday close of $1,507.00-$1,508.00.
Comment E-mail Print Share
First Published: Thu, Jun 30 2011. 09 04 AM IST
More Topics: Asia | Wall Street | Oil | Dow Jones | Stocks |