Asian stocks pare gains as India leaves interest rate unchanged
Source: Bloomberg News |
June 19, 2012, Tuesday
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Print Edition
Print Edition
ASIAN stocks jumped yesterday after election victories for pro-bailout parties eased concern Greece would leave the eurozone. Shares pared gains after India's central bank left interest rates unchanged.
Canon Inc, a camera maker that gets 31 percent of sales in Europe, rose 1.4 percent in Tokyo. Lynas Corp surged 6.3 percent in Sydney after Malaysia upheld the Australian miner's license to run a rare-earths refining facility in the face of protest.
Over US$5 trillion has been erased from global equities since March amid concern growth is slowing in the United States and China, and as Europe's debt crisis intensified.
"There's a short-term sigh of relief," said Belinda Allen, senior investment analyst at Colonial First State Global Asset Management in Sydney, which oversees about US$145 billion. "It removes the tail risk event that we were concerned about in terms of Greece leaving the European Union immediately. We all know there's still a long and hard road ahead for Greece and the problems of Europe aren't solved by this election."
Japan's Nikkei 225 Stock Average and South Korea's Kospi Index advanced 1.8 percent. Australia's S&P/ASX 200 Index rose 2 percent. Hong Kong's Hang Seng Index increased 1 percent.
The Sensex dropped 1.4 percent in Mumbai, erasing gains of as much as 0.9 percent, after India left interest rates unchanged at 8 percent, citing inflation. Only four of 25 economists in a Bloomberg survey predicted the outcome, with 19 expecting a quarter-point cut. DLF Ltd, an Indian real estate company, led declines, falling 4.8 percent.
Asian stocks rose after Greece's pro-bailout New Democracy and Pasok parties took a majority in the 300-member parliament. The results eased concern that Alex Tsipras's Syriza party would take control of the Greek government and reject austerity measures needed to qualify for international aid.
"Greece's election is a good result and will provide some short-term relief," said Nader Naeimi, Sydney-based head of dynamic asset allocation at AMP Capital Investors Ltd, which manages almost US$100 billion.
Companies that do business in Europe advanced. Canon rose 1.4 percent to 3,240 yen (US$40.945) in Tokyo. Hutchison Whampoa Ltd, which operates ports in Spain and Germany, added 1.6 percent to 66.85 Hong Kong dollars (US$8.615) in Hong Kong. HSBC Holdings Plc, Europe's largest lender by market value, increased 1 percent to HK$67.45.
Lynas, the mining company building the world's largest rare-earths refinery in Malaysia, jumped 6.3 percent to 93.50 Australian cents (94.495 US cents). Malaysia's minister of innovation, science and technology on June 15 rejected an appeal by local residents against the company's temporary operating permit.
Canon Inc, a camera maker that gets 31 percent of sales in Europe, rose 1.4 percent in Tokyo. Lynas Corp surged 6.3 percent in Sydney after Malaysia upheld the Australian miner's license to run a rare-earths refining facility in the face of protest.
Over US$5 trillion has been erased from global equities since March amid concern growth is slowing in the United States and China, and as Europe's debt crisis intensified.
"There's a short-term sigh of relief," said Belinda Allen, senior investment analyst at Colonial First State Global Asset Management in Sydney, which oversees about US$145 billion. "It removes the tail risk event that we were concerned about in terms of Greece leaving the European Union immediately. We all know there's still a long and hard road ahead for Greece and the problems of Europe aren't solved by this election."
Japan's Nikkei 225 Stock Average and South Korea's Kospi Index advanced 1.8 percent. Australia's S&P/ASX 200 Index rose 2 percent. Hong Kong's Hang Seng Index increased 1 percent.
The Sensex dropped 1.4 percent in Mumbai, erasing gains of as much as 0.9 percent, after India left interest rates unchanged at 8 percent, citing inflation. Only four of 25 economists in a Bloomberg survey predicted the outcome, with 19 expecting a quarter-point cut. DLF Ltd, an Indian real estate company, led declines, falling 4.8 percent.
Asian stocks rose after Greece's pro-bailout New Democracy and Pasok parties took a majority in the 300-member parliament. The results eased concern that Alex Tsipras's Syriza party would take control of the Greek government and reject austerity measures needed to qualify for international aid.
"Greece's election is a good result and will provide some short-term relief," said Nader Naeimi, Sydney-based head of dynamic asset allocation at AMP Capital Investors Ltd, which manages almost US$100 billion.
Companies that do business in Europe advanced. Canon rose 1.4 percent to 3,240 yen (US$40.945) in Tokyo. Hutchison Whampoa Ltd, which operates ports in Spain and Germany, added 1.6 percent to 66.85 Hong Kong dollars (US$8.615) in Hong Kong. HSBC Holdings Plc, Europe's largest lender by market value, increased 1 percent to HK$67.45.
Lynas, the mining company building the world's largest rare-earths refinery in Malaysia, jumped 6.3 percent to 93.50 Australian cents (94.495 US cents). Malaysia's minister of innovation, science and technology on June 15 rejected an appeal by local residents against the company's temporary operating permit.
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