Asian shares rocket as Japan s economy grows
Asian stocks rocketed higher today, fueled by news that the Japanese economy grew for the first time in a year. The MSCI Asia Pacific index […]
Asian stocks rocketed higher today, fueled by news that the Japanese economy grew for the first time in a year. The MSCI Asia Pacific index was around 1.4% higher in early afternoon trading, paring back some of last week’s losses.
Japanese GDP grew at an annualised 6% in the quarter ending September, mostly in line with market expectations. Growth was driven by the resumption in exports, driven by auto makers for example – the same companies which are feeling the pressure of the strong Japanese Yen and pushing authorities to limit the appreciation. The Yen continued to rally against the US dollar during today’s session, with the USD/JPY last trading slightly above 77.12.
Staying on currencies, the unease in the U.S. on China’s currency valuation seems to be rising as President Barack Obama remarked “enough is enough”. The news shows the political pressure Obama faces going into an election year in 2012 with an unemployment rate above 9%.
We think more rhetoric from U.S. policymakers will be forthcoming but this is unlikely to sway the Peoples Bank of China (PBOC), which has so far done a good job in containing inflation while still managing healthy growth.
In energy markets, Brent crude remains above US$114/per barrel while Nymex light crude last settled above US$99/per barrel. Energy traders continue to eye Middle East tensions closely. As is the case with China’s currency, some speculate President Obama will be forced to take tighter action against Iran as Republican candidates continue their criticism.
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