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Asia jumps on Greece’s pro-euro election results
Investors cheer the victory of pro-bailout parties easing concern over Greece exiting the euro.
Asian shares jumped on Monday after Greece's election delivered a slim parliamentary majority to pro-bailout parties - New Democracy and PASOK - easing concern over the country exiting the euro.
The MSCI Asia Pacific Index climbed 1.5% to 116 as of 11:37 a.m. in Tokyo. Japan’s Nikkei 225 Stock Average gained 1.8% and South Korea’s Kospi Index advanced 2.1%. Australia’s S&P/ASX 200 Index rose 1.4%. Hong Kong’s Hang Seng Index increased 1.6%, while China’s Shanghai Composite Index added 0.6%.
New Democracy and PASOK, which broadly support the €130 billion EU/IMF bailout, will begin forging a government on Monday. The New Democracy party has signalled it would stick to the outlines of a bailout agreement that Greece struck with the eurozone in February.
Asia Pacific governments welcomed Greek election results and urged the quick formation a new government. A statement from the Group of Seven major industrialised nations said it was in "all our interests" for Greece to remain in the eurozone while respecting its international bailout commitments.
Shares of the companies that do business in Europe advanced. Canon Inc., a camera maker that gets 31% of sales in Europe, rose 1.7% in Tokyo. Lynas Corp. surged 9.1% in Sydney after Malaysia upheld the Australian miner’s license to run a rare-earths refining facility in the face of protest.
Hong Kong Exchanges & Clearing Ltd., the world’s second-largest bourse operator, slipped 2.6% after agreeing to pay $2.18 billion for the London Metal Exchange.
The victory of pro-bailout parties also pushed the euro up around 0.4% at about $1.2685 - a one-month high. US stock index futures and riskier commodities such as crude oil and copper also jumped, while gold declined after a rally last week. US crude rose 1% to around $84.90 a barrel, Brent crude gained nearly $1 to above $98.50 and copper was 0.6% higher around $7,556 a metric tonne. Gold was down 0.3% at around $1,623 an ounce.
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by Michelle McGagh on Dec 09, 2013 at 05:01