Asia stocks rise on US stimulus plan hopes

Asia stocks rise on US stimulus plan hopes
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First Published: Mon, Feb 09 2009. 08 50 AM IST
Updated: Mon, Feb 09 2009. 08 50 AM IST
Tokyo: Asian stocks rose on Monday amid hopes that a massive US stimulus package would bolster the economy, while the dollar clung near a one-month high against the yen as investor risk aversion waned despite grim US data.
Hong Kong shares opened 1.5% higher, heading for a fourth day of gains and their longest winning streak in two months, while Japan’s Nikkei average climbed for a second straight day.
Wall Street rallied broadly on Friday after figures showing US job losses in January were the worst in 34 years, sparking hopes that Congress will act quickly to pass a stimulus package to help the economy.
But the US administration pushed back the announcement of a keenly awaited bank rescue plan until Tuesday from Monday as it pressed lawmakers to settle their differences over the huge stimulus plan.
“Investors picked up exporters for now on short-covering, but it’s doubtful if the market will continue to gain,” said Takahiko Murai, general manager of equities at Nozomi Securities in Tokyo.
Squabbling over the US rescue plan was set to continue on Monday, when the Democratic-led Senate votes to end debate on an $827 billion rescue package so it can be passed on Tuesday.
US President Barack Obama has demanded that the bill be on his desk for signing into law by next Monday.
Japan’s Nikkei stock average rose 1% with Honda Motor Co and Toyota Motor Corp climbing despite Toyota’s forecast of a larger than expected loss on Friday since bad news had been widely anticipated.
But shares in Nomura Holdings Inc, Japan’s biggest brokerage, sank 10% to a 26-year low amid concerns that a plan to issue up to $3.3 billion in new stock to bolster its capital would dilute earnings.
The MSCI index of Asia-Pacific stocks outside Japan climbed 0.9%.
The dollar hit a one-month high against the yen before falling back slightly, giving little reaction to data showing Japan’s current account surplus fell 92.1% in December from a year earlier.
The US currency traded around ¥91.72 yen after climbing to ¥92.42 yen earlier on trading platform EBS, its highest since early January. The euro was at $1.2950.
The Australian dollar was struggling to hold onto gains after hitting a three-week high offshore on Friday, trading at about $0.6685.
Oil took a breather from its recent decline and steadied around $40 a barrel on Monday as hopes that swift passage of the US stimulus package outweighed demand concerns, with US crude for March delivery edging down by one cent to $40.17.
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First Published: Mon, Feb 09 2009. 08 50 AM IST
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