Asian Stocks Rally Resumes On Stimulus Hope

Umer Jamshaid Published July 21, 2016 | 11:41 AM

HONG KONG,(UrduPoint / Pakistan Point News - 21st july,2016) - Asian markets got back into their positive groove Thursday following a fresh Wall Street record as traders are pumped up by strong corporate results and expectations for fresh stimulus. After a slight stumble Tuesday and Wednesday caused by profit-taking, the equities rally resumed with Tokyo again leading the pack following a report that Japan is planning a new, giant stimulus programme. Prime Minister Shinzo Abe is eyeing a package of at least 20 trillion yen to kickstart the economy from years of slumber and light a fire under torpid inflation, about double the size initially expected, Kyodo news agency said. The likelihood of more Yen flooding financial markets sent the currency tumbling, which in turn boosted stocks, particularly exporters who benefit from a weaker unit. The Nikkei ended the morning 1.1 percent higher, with the Dollar climbing to 107.

40 yen from 106.87 yen, and well up from the 100 yen levels seen before the US released blockbuster jobs data at the start of the month. Other stock markets followed suit, with Hong Kong up 0.5 percent, wiping out all the losses suffered since the tumultuous start of the year. Shanghai climbed 0.2 percent higher, while Sydney added 0.6 percent and Seoul gained 0.1 percent.

Singapore, Wellington and Taipei also rallied. The advances follow a positive lead from Wall Street, where the Dow and S&P 500 closed at all-time highs on the back of a string of upbeat earnings reports and outlooks from big-name firm such as microsoft, Intel and Morgan Stanley. "We have better corporate earnings, likely bold fiscal stimulus in Japan, zero interest rates helping to absorb every macro shock we hear about and broad monetary easing," Chris Weston, chief market strategist at IG Ltd in Melbourne, told Bloomberg News.