Asian stock markets boosted by ECB stimulus plan
Jan. 23, 2015
TOKYO (AP) — Asian stocks zoomed higher Friday, boosted by the European Central Bank's stimulus announcement, a long awaited move that also set off gains in Europe and on Wall Street.
KEEPING SCORE: Japan's Nikkei 225 rose 0.9 percent to 17,480.08 and Hong Kong's Hang Seng added 1.2 percent to 24,806.89. South Korea's Kospi gained 0.7 percent to 1,934.35. Australia's S&P/ASX 200 jumped 1.2 percent to 5,486. Markets in mainland China, Taiwan, India and Southeast Asia also rose.
EUROPE FACTOR: Europe's ailing economy will get a major dose of stimulus from the European Central Bank's bond buying program designed to make loans and exports cheaper so companies can hire and expand. Starting in March, the ECB will buy 60 billion euros of government and corporate bonds each month at least through September 2016. The 1.1 trillion euro program was an emphatic signal of the ECB's willingness to do all it can to rejuvenate the economy shared by the 19-nation euro currency alliance.
THE QUOTE: "The news was positive. But on top of that, the fact that a major event has come and gone has set off a big sense of relief," said Takuya Takahashi, strategist at Daiwa Securities Co. in Tokyo
CHINA WORRIES: One dampener to the global growth optimism came from China. An HSBC report Friday said China's manufacturing shrank for a second month in January, largely because of weak demand. Earlier in the week, official Chinese data showed the world's second-biggest economy expanded 7.4 percent last year, the slowest pace since 1990.
WALL STREET: The Standard & Poor's 500 index jumped 31.03 points, or 1.5 percent, to close Thursday at 2,063.15. That nudged it into positive territory for the year, up 0.2 percent. The Dow Jones industrial average climbed 259.70 points, or 1.5 percent, to 17,813.98 while the Nasdaq climbed 82.98 points, or 1.8 percent, to 4,750.40.
OIL PRICES: Benchmark U.S. crude was up 81 cents to $47.12 a barrel in a kneejerk reaction to news that Saudi Arabia's King Abdullah died. Analysts say the king's death is unlikely to change Saudi's high oil production levels, a key factor in the collapse in oil prices in the past six months. On Thursday, the contract fell $1.47 to close at $46.31 a barrel in New York. Brent crude was up 89 cents to $49.41 a barrel on the ICE exchange in London.
CURRENCIES: The dollar fell to 118.39 yen from 118.56 yen the previous day. The euro steadied after falling on the ECB announcement to its lowest since September 2003. It was up slightly at $1.1365 from $1.1356.
Yuri Kageyama on Twitter: https://twitter.com/yurikageyama