Asia stock markets continue to rise on hopes of stimulus

Asian markets were generally higher yesterday, their third consecutive positive session, as traders looked for new stimulus measures from European and US central banks. Tokyo stocks closed up 0.69, or 59.62 points, at 8,695.06, amid hopes for a firm recovery by Japanese high-tech manufacturers before they released quarterly earnings. Sydney gained 0.55%, or 23.5 points, to 4,269.2, Seoul finished 2.07, or 38.20 points, higher at 1,881.99, and Hong Kong rose 1.08%, or 211.41 points, to end at 19,796.81. But Shanghai was down 0.3%, or 6.28 points, to 2,103.63, on fears the slowing domestic economy may hurt corporate earnings. Hopes for new rounds of monetary stimulus by the Federal Reserve have been heightened by weak US growth data, while European leaders and ECB chief Mario Draghi have pledged to do whatever is necessary to protect the euro. The Federal Open Market Committee was to start a two-day meeting yesterday, after the US government reported last week that growth in the world’s biggest economy slowed to 1.5% in the second quarter, from 2.0% in the first quarter. Tomorrow, the Bank of England and the European Central Bank (ECB) will unveil their latest monetary policy decisions, as both grapple with fallout from the ongoing eurozone sovereign debt crisis. He said Draghi’s pledge to do whatever it takes to preserve the euro had “made people believe we will see a strong policy response”. US President Barack Obama said late Monday that the eurozone had to take “decisive steps” to deal with the crisis. “I’m spending an enormous amount of time trying to work with them — and (US Treasury Secretary) Tim Geithner is spending a lot of time working with them — to recognise that the sooner they take some decisive action, the better off we’re going to be,” Obama told campaign donors. In Japan, the unemployment rate edged down from 4.4% in May to 4.3% in June, while average household spending rose 1.6% from a year earlier, offering a glimmer of hope for the nation’s fragile economy. After the markets closed in Tokyo, Honda Motor announced profits had surged more than fourfold to $1.7bn for the three months to June compared to the same period last year, while Panasonic swung into the black posting a net profit of $164mn. But Toshiba fell to a quarterly net loss of $155, owing to restructuring costs and the impact of a strong yen. On Asian currency markets the euro was at $1.2257 in early European trade Tuesday from $1.2260 in New York, and bought 95.95 yen from 95.86. The dollar was at 78.28 yen from 78.19 yen. Gold in Asian trading was at $1,623.10 at 0850 GMT, from $1,618.30 on Monday. In other markets, Taipei was up 1.56%, or 111.61 points, at 7,270.49, Manila closed 0.56%, or 29.76 points, higher at 5,307.66 and Wellington was up 0.74%, or 26.12 points, to 3,545.01.