World Economy

Europe, Asia Stocks Advance

Europe, Asia Stocks AdvanceEurope, Asia Stocks Advance

The euro extended its gains against the dollar on Tuesday while most Asian equities climbed on hopes Greece’s new government will be able to negotiate a bailout deal with the EU and IMF that will avoid it leaving the eurozone.

Regional dealers were given a lift from advances in Europe and New York, where news of Sunday’s Greek election win for anti-austerity party Syriza had been largely factored in, analysts said, AFP reported.

However, Hong Kong and Shanghai suffered heavy selling on profit-taking after rallying over the past week. Tokyo rallied 1.72 percent or 299.78 points to 17,768.30, Sydney added 0.82 percent or 45.38 points to close at 5,547.2 and Seoul rose 0.86 percent or 16.72 points to close at 1,952.40.

But Shanghai fell 0.89 percent or 30.22 points to 3,352.96 and Hong Kong eased 0.41 percent or 102.62 points to 24,807.28. Shanghai had rallied more than eight percent since last Monday, when it plunged 7.70 percent in response to a government crackdown on margin-trading.

Markets have been buoyed by rhetoric coming out of Athens and its creditors that raises hopes the two sides can reach an agreement over Greece’s repayment of its €240b bailout.

Syriza had campaigned on renegotiating terms of the lifeline – which included swinging spending cuts and painful tax hikes – and there are concerns it will default on its repayments, leading to its possible exit from the eurozone.


In Europe, equities in London, Paris and Germany all closed with healthy gains, although Athens lost more than three percent. Dow edged 0.03 percent higher, the S&P 500 added 0.26 percent and the Nasdaq put on 0.29 percent.

The euro plunged to as low as US$1.1098 at one point in Asia on Monday, the lowest level since September 2003, before recovering later in the day to close out in New York at $1.1234. On Tuesday in Asia it bought $1.1250.

The euro also sank to 131.55 yen on Monday in Asia before bouncing to end the day at 133.12 yen. It bought 132.90 yen in Tokyo on Tuesday. The US dollar edged down to 118.11 yen from 118.49 yen in US trade.

Oil prices slipped despite a warning from the OPEC cartel that prices could punch US$200 owing to shrinking investment in exploration. US benchmark West Texas Intermediate for March delivery fell 10 cents US$45.05 while Brent crude for March eased 12 cents to US$48.04. Gold fetched US$1,278.96 an ounce, against US$1,281.39 late Monday.