Asia soars on steps to shore up markets

Asia soars on steps to shore up markets
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First Published: Wed, Oct 15 2008. 12 02 AM IST
Updated: Wed, Oct 15 2008. 12 02 AM IST
Hong Kong: Asian stocks soared on Tuesday after investors welcomed concerted efforts by world leaders to put an end to the global financial meltdown.
Governments in the US, Europe, Japan and Australia introduced measures totalling more than $1 trillion, boosting confidence that the current credit crisis could be easing.
Tokyo’s Nikkei soared 1,171.14 points, or 14.15%, to end at 9,447.57, its biggest ever percentage gain. The index saw its worst show in two decades on Friday after plummeting almost 10%. Japan’s markets were closed for a holiday on Monday.
The surge came after the government unveiled measures aimed at stabilizing its shaky financial markets, including a relaxation of restrictions on corporate share buy-backs.
The government also ploughed an additional ¥2 trillion (Rs1 trillion) into the market to maintain liquidity.
Sydney ended the day 3.7% higher after Prime Minister Kevin Rudd announced an Australian $10.4 billion (Rs34,948 crore) stimulus package to address the crisis, equivalent to 1% of the country’s gross domestic product.
Hong Kong added 3.2%, Seoul was more than 6% higher and Taipei was up 5.4%, while Singapore rose 2.5%. Other major gainers were Manila, which soared more than 7%, Jakarta, up 6.4%, and New Zealand, almost 6% higher.
Markets were cheered by rescue packages in Europe, with governments working in concert to stem the crisis, while Washington said it would buy stakes in an array of financial firms.
Britain pumped £37 billion (Rs3.08 trillion) into three struggling banks, while Germany, France, Spain and Austria on Monday pledged a total of €1.03 trillion (Rs67.05 trillion) for troubled financial institutions.
Hong Kong later on Tuesday said it would fully guarantee all bank deposits, following a similar move by several nations in the past week.
Investors were following Wall Street, where the Dow Jones Industrial Average jumped 936.42 points, or 11.08%, to 9,387.61, on Monday, snapping an eight-session losing streak. It was the Dow’s biggest points gain on record and its sharpest percentage rise since 1933 during the Great Depression.
However, Shanghai bucked the trend, closing 2.71% lower as concerns remained about the world economy. And despite markets showing sharp upturns recently, they are still heavily down from the beginning of the year.
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First Published: Wed, Oct 15 2008. 12 02 AM IST
More Topics: Asia | Stocks | Investors | Government | Prime Minister |