Nikkei Leads Asia Markets Higher, Seoul Boosted by Rate Cut
Nikkei Stock Average rises, South Korea breaks four-day losing streak
Stocks in Asia rebounded Thursday, with a weaker yen lifting Japan and a rate cut in South Korea helping shares there break a four-day losing streak.
The Nikkei Stock Average led the region, rising 1.3% after a selloff Wednesday sparked by comments from Bank of Japan Governor Haruhiko Kuroda that sent the currency to a two-week high against the U.S. dollar.
Thursday, the yen weakened to 123.06 to the dollar from 122.69 late Wednesday in New York. A weaker yen is generally better for Japanese exporters.
In Seoul, stocks were up 0.5% after the central bank cut interest rates by 0.25 percentage point to a record low of 1.5%. Economists had expected a cut to counteract the effects of the MERS outbreak in the country as well as deteriorating economic indicators.
“Today’s cut is probably partially in response to MERS given that it poses risks to domestic demand in Korea,” said Krystal Tan at Capital Economics. “It would take a pretty severe deterioration in the growth outlook before they would cut again,”
Asia’s markets also got a lift from gains in the U.S., where the Dow rose sharply as the tech sector rallied and investors got encouraging signals about Greece’s financing talks. A selloff in bonds continued with yields on U.S. Treasurys and German bunds rising to their highest levels this year.
Australia’s S&P ASX 200 was up 1.2%, helped by firmer commodity prices. The Aussie dollar was at its highest against the greenback in more than a week after better than expected unemployment data for May.
China’s Shanghai Composite Index was down 0.4%, while Hong Kong’s Hang Seng Index was up 0.6%.
Source: WSJ – Nikkei Leads Asia Markets Higher, Seoul Boosted by Rate Cut
