Asian markets rebound on news of G7 intervention
City Index March 18, 2011 8:55 PM
<p>Asian markets rebounded today, led by Japan, which gained almost 3 per cent. The gains came on the back of a G7 announcement that it […]</p>
Asian markets rebounded today, led by Japan, which gained almost 3 per cent. The gains came on the back of a G7 announcement that it will intervene to help arrest the strong move on the Japanese Yen.
Japanese stocks climbed, paring their worst weekly performance since 2008, as the country continued to grapple with the aftermath of the earthquakes and tsunami that hit last week. Honda Motor Co, Japan’s second largest carmaker by sales jumped 0.8%. Kyocera Corp, an electronics maker that gets more than half of its sales abroad advanced 3.5%.
In Hong Kong, stocks rose trimming the benchmark index’s weekly decline. PetroChina Co, China’s biggest oil producer, gained 2.9 per cent after reporting earnings that beat analyst estimates. Henderson Land Development Co, the homebuilder controlled by billionaire Lee Shau-kee increased 3.7% after saying 2010 underlying profit improved 9 per cent.
In Australia, the share market rebounded after the G-7 group of nations intervened to curb the strength in the Japanese Yen.
This (G7 intervention) gave the markets a bit of a lifeline, but I don’t think the overall sentiment has really changed.
There are definitely bargain hunters scouting and buying at very low levels. But it’s possible that it’s not really a turnaround (in the market sentiment).
This intervention is definitely temporary. It’s got a very unnatural feel to it. And I think the impact will be temporary, at best.
Investors and traders are buying at the moment, but I think they will be happy to rush out of the market at the slightest hint of any negative news.
If you consider things closely, there are still a lot of uncertainties hanging around. Libya and the Middle East and the Japanese situation are nowhere near being resolved. So, the basic fundamentals have not changed that much over the past few days. Anxiety and uncertainty may be hanging around in the short-term.
GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.