Global Markets: Asian shares rise

Asian stocks

Asian shares rose on Tuesday on hopes of a compromise in the U.S. fiscal crisis, while the euro fell after Moody's Investors Service scrapped France's top-notch credit rating, reminding investors of the protracted euro zone debt crisis.

Global stocks and commodities surged on Monday to recover some of last week's sharp losses on hopes U.S. lawmakers will reach a deal to avert $600 billion in tax increases and spending cuts due to start in January - the fiscal cliff that threatens to send the U.S. economy back into recession.

Prospects that Greece will get a lifeline to stay solvent also helped boost markets, but the euro zone's debt crisis saw Moody's cut France's government bond rating to Aa1 and kept its negative outlook, citing the country's uncertain fiscal outlook and deteriorating economic prospects.

France's downgrade sent the euro down 0.3 percent to $1.2777 in early Asia from $1.2810, a two-week high reached on Monday, and also pushed crosses lower such as the euro against the yen down 0.4 percent and the Australian dollar against the yen down 0.1 percent.

MSCI's broadest index of Asia-Pacific shares outside Japan inched up 0.3 percent. Australian shares were up 0.2 percent and South Korean shares opened 1 percent higher.

Wall Street stocks climbed almost 2 percent, extending a rally that began on Friday, with the Standard & Poor's 500 Index closing above its 200-day moving average for the first time in eight sessions. Crude oil jumped almost 3 percent.

Japan's Nikkei average opened up 0.5 percent at a fresh two-month high.

Moody's news is certainly not positive but market reaction seems contained, said Hiroshi Maeba, head of FX trading Japan for UBS in Tokyo, adding that trading was getting lighter ahead of the U.S. Thanksgiving holiday weekend.

... contd.

Please read our terms of use before posting comments
TERMS OF USE: The views expressed in comments published on indianexpress.com are those of the comment writer's alone. They do not represent the views or opinions of The Indian Express Group or its staff. Comments are automatically posted live; however, indianexpress.com reserves the right to take it down at any time. We also reserve the right not to publish comments that are abusive, obscene, inflammatory, derogatory or defamatory.