Asian Stocks Extend Global Rally On Economy Hopes


Salon Staff
February 2, 2012 11:18AM (UTC)

SINGAPORE (AP) — Asian stocks extended a global rally Thursday amid investor optimism that the U.S. economy may grow more than previously expected this year.

Benchmark oil stayed below $98 per barrel while the dollar was lower against the euro but steady against the yen.

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Tokyo's Nikkei 225 rose 0.7 percent to 8,875.21 while Hong Kong's Hang Seng gained 1.5 percent to 20,629.68 and Seoul's Kospi added 1.1 percent to 1,980.90.

Signs of an improving U.S. economy have helped bolster trader sentiment. Factories raised output in January by the most in seven months, according to the Institute for Supply Management's manufacturing index on Wednesday. And the Commerce Department said construction spending rose 1.5 percent in December, the fifth straight monthly gain.

Investors have also been cheered by growing optimism that contagion from a likely Greek debt default can be contained.

Global equities are advancing "on hopes of the global economy gaining a solid footing and the banking sector continued to rally on the belief that Europe will avoid a catastrophe," IG Markets in Melbourne said in a report.

On Wednesday, the Dow Jones industrial average closed up 0.7 percent at 12,716.46. The S&P added 0.9 percent to 1,324.09 while the Nasdaq composite index rose 1.2 percent to close at 2,848.27.

European stock indexes also rose Wednesday. France's CAC-40 gained 2.1 percent while Britain's FTSE 100 rose 1.9 percent and Germany's DAX jumped 2.4 percent.

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China's benchmark Shanghai Composite Index climbed 0.4 percent to 2,276.22 on Thursday amid signs manufacturing improved in January for a second straight month.

Shares in Singapore, Australia, Taiwan, New Zealand, Thailand and India all gained ground.

"After stepping into a soft patch in the fourth quarter, Asian economic growth is gradually picking up," said Frederic Neumann, co-head of Asian economics at HSBC in Hong Kong. "This rebound is led by the region's giants: China, India, and Japan."

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Early Thursday, the Tokyo Stock Exchange suspended trading in 241 securities, including Sony Corp. and Hitachi Ltd., due to a glitch in its electronic trading system. Trading in the suspended securities resumed near midday.

Benchmark oil for March delivery fell 16 cents to $97.45 per barrel Thursday in electronic trading on the New York Mercantile Exchange. The contract fell 87 cents to settle at $97.61 on Wednesday.

In currencies, the euro rose to $1.3165 from $1.3158 late Wednesday in New York. The dollar was little changed at 76.14 yen.

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