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Asia markets follow US, Europe higher on Greece hopes
Most Asian markets climbed Tuesday on growing hopes that Greece and its creditors will finally hammer out a debt reform deal that will avoid a default and possible eurozone exit
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ost Asian markets climbed Tuesday on growing hopes that Greece and its creditors will finally hammer out a debt reform deal that will avoid a default and possible eurozone exit.
The gains tracked a record close for the Nasdaq on Wall Street while European markets also soared, including a nine percent surge in Athens. But the euro retreated in Japanese trade as investors await the next move.
Investors were also cheered by preliminary figures suggesting a contraction in Chinese manufacturing activity may be easing.
Tokyo soared 1.87 percent, or 381.23 points, to end at 20,809.42, breaking through 20,700 for the first time since April 2000.
Sydney advanced 1.32 percent, or 74.10 points, to 5,684.3 and Seoul closed up 1.27 percent, or 26.04 points, at 2,081.20.
Shanghai, which plunged more than six percent Friday before a long weekend, was up 1.41 percent in the afternoon while Hong Kong was 0.80 percent higher.
Eurozone leaders said they were confident they would bring an end to the five-month crisis over Greece's bailout reform after it submitted proposals aimed at freeing up much-needed cash to help it pay its bills.
Cash-strapped Greece is at risk of defaulting on a 1.5-billion-euro (US$1.7-billion) IMF payment on June 30 if it fails to reach a deal. That could lead to it crashing out of the eurozone and even the European Union.
After an emergency summit in Brussels on Monday, eurozone chiefs told their finance ministers to hold fresh talks on Wednesday to thrash out details of an accord before a summit of the 28 EU leaders on Thursday.
EU sources told AFP that Greece had now met 90 percent of the conditions set by its creditors, while European Commission chief Jean-Claude Juncker told a news conference he was "convinced" a deal would be done.
On Wall Street Monday the Nasdaq rose 0.72 percent to a new record, the Dow added 0.58 percent and the S&P 500 advanced 0.61 percent.
Athens rocketed 9.0 percent, the CAC 40 in Paris jumped 3.81 percent, Frankfurt's DAX 30 also gained 3.81 percent. London's benchmark FTSE 100 rose 1.72 percent, the Milan exchange added 3.46 percent and Madrid climbed 3.87 percent.
"Hopes are likely to heighten for a positive outcome over the Greek issue before a European Union summit later this week after Greece signalled readiness to compromise," Yujiro Goto, currency strategist at Nomura Holdings, told Bloomberg News.
However, the euro eased to $1.1268 and 139.27 yen in Tokyo trade from $1.1340 and 139.91 yen in New York late Monday.
While the single currency was underpinned by optimism about a Greece deal, analysts said it is being hurt by the prospect that the European Central Bank will stick to its massive easing program as the US Federal Reserve prepares to tighten.
The dollar was at 123.65 yen against 123.38 yen in New York and well up from 122.73 yen in Tokyo earlier Monday.
Buying on Tuesday was also supported by HSBC's early June reading of China manufacturing. Its purchasing managers index came in at 49.6, just below the 50 mark that separates contraction from growth but up from May's 49.2. It also beat a forecast of 49.4 by economists surveyed by Bloomberg.
The figures fuel hopes the world's number two economy may be about to pick up after a series of interest rate cuts in response to a sharp slowdown over the past several quarters.
On oil markets US benchmark West Texas Intermediate for August delivery was down 14 cents at $60.24 a barrel in afternoon Asian trade, and Brent dropped nine cents to $63.25.
Gold fetched $1,186.10 compared with $1,192.86 late Monday. (ren)(+++)
