- The Washington Times - Friday, March 13, 2009

HONG KONG (AP) - Asian markets soared Friday as the prospect of fresh stimulus measures in China and Japan and upbeat signals from major U.S. firms like Bank of America sparked hopes of a turnaround in the world economy. European markets opened higher.

Major markets advanced throughout Asia, with Japan’s index shooting up more than 5 percent and Hong Kong’s benchmark gaining over 4 percent. Companies across all industries, from Japanese exporters to Australian resource firms and Chinese banks, posted strong gains.

Boosting confidence were comments from Chinese Premier Wen Jiabao that the government _ already moving ahead with a 4 trillion yuan ($586 billion) stimulus package _ stood ready to roll out even more measures if needed to reinvigorate growth. In Japan, Prime Minister Taro Aso called for a fresh stimulus package to help lift the economy out of one its worst slumps since World War II.

Plummeting overseas demand for exports has battered the economies of Japan and China _ the world’s two biggest after the U.S. _ and been deeply unsettling for investors. Any measures to bolster the growth of the Asian economic powerhouses are bound to raise hopes of spillover effects for the rest of the region through greater consumer and industrial spending.

“We already have our plans ready to tackle even more difficult times, and to do that we have reserved adequate ammunition,” Wen said at a news conference following the close of China’s annual legislative meeting. “That means that at any time we can introduce new stimulus policies.”

Investors were also cheered by an overnight rally on Wall Street, driven partly by more signs that U.S. financial companies are on the mend. Bank of America’s CEO said his bank, America’s largest, was profitable in January and February, echoing similar assessments from Citigroup and JPMorgan this week. Better-than-expected retail sales figures further girded sentiment.

In Japan, the Nikkei 225 stock average jumped 371.03 points, or 5.2 percent, to 7,569.28, and Hong Kong’s Hang Seng climbed 524.27 points, or 4.4 percent, to 12,525.80.

Elsewhere, Singapore’s stock measure vaulted 5.6 percent. Stock measures in Australia, Taiwan and India all added 3 percent or more.

Chinese markets, closed to most foreign investors and often out of sync with regional bourses, were lower, with Shanghai’s benchmark giving up early gains to trade down 0.2 percent. South Korea also fell marginally.

European stocks followed Asia’s move higher, with Britain’s FTSE 100 gaining 1.8 percent, Germany’s DAX up 1.3 percent and France’s CAC-40 1.7 percent higher. Wall Street was poised to rise again after U.S. futures reversed an earlier fall. Dow futures were up 36 points, or 0.5 percent, at 7,204 and S&P500; futures rose 5.1, or 0.7 percent, to 753.50.

Despite the upturn, analysts were reluctant to predict an end to the vicious selling that has ravaged global stock markets this year. This week’s gains are partly the result of investors, who had shorted the market, now covering their bets, not a wholesale shift in the outlook for the slumping world economy.

“The economy is not disappearing yet, so that’s good news. But there’s still not enough confirmation that we are at a bottom,” said Henry Chan, Hong Kong-based head of Asian equities at Baring Asset Management, which oversees about $6 billion in regional equities. “The markets are oversold, so technically you have to have a bounce.”

Overnight in New York, the Dow rose 239.66, or 3.5 percent, to 7,170.06. The Standard & Poor’s 500 index climbed 29.38, or 4.1 percent, to 750.74. The Nasdaq composite index gained 54.46, or 4 percent, to 1,426.10.

Oil prices, which surged overnight, slipped below $47 a barrel as investors jockeyed over whether OPEC will announce a production cut at its meeting on Sunday, and how big the cut might be.

Benchmark crude for April delivery fell 23 cents to $46.82 a barrel by midday in Singapore on the New York Mercantile Exchange. Oil prices vaulted $4.70 on Thursday to settle at $47.03.

In currencies, the dollar gained to 98.28 yen from 97.52 yen. The euro fell to $1.2914 from $1.2989.

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