Asian stocks may get boost from positive US lead
City Index January 19, 2012 3:30 AM
<p>Asian stocks are set to open higher following positive offshore leads. Overnight, the S&P500 booked its best start to a year since 1987 as companies […]</p>
Asian stocks are set to open higher following positive offshore leads.
Overnight, the S&P500 booked its best start to a year since 1987 as companies continued to report their quarterly results.
Goldman Sachs was the standout in the financials space and while earnings fell significantly, the decline was below expectations, sending the stock up almost 7% in trading. It managed to boost other financials including Bank of America and JP Morgan which close more than 4% higher. The S&P500 finished 1.15 higher at its close, closing above 1,300 for the first time since mid last year.
Risk appetite spilled over into other asset classes, with the Euro rising to 1.285 against the US dollar while the Australian dollar firmed above 1.04.
Gold continues to consolidate recent gains, last at US$1659/oz.
In New Zealand, inflation as measured by consumer prices declined by 0.3%. Market estimates were for an increase of 0.4% so the divergence is large on face value.
Regional traders are eyeing the response of Chinese regulators, particularly around the reserve ratio requirements imposed on the banks to slow down the economy in late 2011. The expectation is those restrictions will be eased shortly to allow more credit into the system. Media reports are speculating that regulators are close to announcing the relaxation and this will be a large announcement for all regional Asian equities.
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