TOKYO - Asian markets rose sharply Tuesday as investors regained some confidence after a strong overnight showing by Wall Street and the U.S. government's bailout of banking giant Citigroup. European markets, which soared Monday, opened lower.
Initial reaction in the region to the Citigroup news which broke midday Monday in Asia was tepid, and most benchmarks had ended the day lower. But after seeing markets in Europe and the U.S. surge overnight, Asian investors joined in the rally.
``The rescue of Citigroup does help ease concerns,'' said Singapore-based investment analyst Nicole Sze of Bank Julius Baer & Co., which manages about $300 billion in assets. ``Citigroup is such a crucial financial institution in the global market. The U.S. action does fuel a return of confidence.''
In Japan, which had been on holiday Monday, the Nikkei 225 stock average soared 413.14 points, or 5.2 percent, to 8,323.93.
Australia's benchmark S&P/ASX200 index leaped 5.8 percent to close at 3,623.4, led by materials, energy, banks and consumer discretionary stocks.
Hong Kong's Hang Seng index rose 3.4 percent to 12,878.60, and the Philippines' main index jumped more than 6 percent. Among major markets, mainland China, Singapore and India declined.
Chinese stocks have rolled back since rallying earlier this month on news of a multibillion dollar government economic stimulus package. Adding to concerns, the World Bank on Tuesday cut its 2009 growth forecast for China from 9.2 percent to 7.5 percent the lowest rate in 18 years.
``Selloffs appeared after speculation about the stimulus news was over,'' said Zhou Lin, an analyst for Huatai Securities. ``Stocks that gained most in the previous sessions were also the biggest losers today.''
Meanwhile, sentiment was also sour in Europe. The FTSE 100 index of leading British shares lost 1.4 percent, Germany's DAX declined 1.5 percent, and the CAC-40 in France was down 0.8 percent.
Wall Street and European markets surged Monday on news that the U.S. government will take a $20 billion stake in Citigroup and guarantee hundreds of billions of dollars in risky assets. The Dow Jones industrials soared 396.97 points, or 4.93 percent, to 8,443.39 Monday the first two-day advance since Oct. 31.
U.S. stock index futures were lower, suggesting Wall Street would open lower. Dow futures were down 52 points, or 0.7 percent, to 8,327, while S&P futures were down 5 points, or 0.6 percent, to 843.
Japanese officials in Tokyo hailed Washington's move.
Economy Minister Kaoru Yosano called the plan a ``courageous decision'' to save the massive global banking group, noting that the world's economy could be affected by Citigroup's fate, according to Kyodo news agency.
All three of Japan's megabanks climbed. Sumitomo Mitsui Financial Group Inc. soared 11.48 percent, Mizuho Financial Group Inc. added 9.17 percent, and Mitsubishi UFJ Financial Group Inc. closed up 2.85 percent.
Wall Street's gains also drove commodity markets higher as oil prices jumped 9 percent Monday, though they slipped back bit in Asian trading Tuesday.
Commodity shares in Australia gained, with BHP Billiton, the world's biggest miner, surging 12.2 percent.
After jumping $4.57 overnight, light, sweet crude for January delivery was down $2.10 to $52.40 a barrel in electronic trading on the New York Mercantile Exchange by midday in Singapore.
In currencies, the dollar fell to 95.75 yen from 96.88 yen late Monday. The euro also slid to $1.2825 from $1.2925.
Wednesday
October 9th, 2024
10:31PM
