HONG KONG: Asian markets mostly rose on Friday after a record close on Wall Street while the euro continued to defy mounting fears about Greece’s future in the eurozone, but Shanghai plunged more than six percent on tight liquidity.
The yen edged down after the Bank of Japan held off on any new stimulus measures at its latest policy meeting despite flatlining inflation.
Tokyo ended 0.91 percent higher, adding 183.42 points to 20,174.24, Sydney lifted 1.31 percent, or 72.1 points, to 5,597 and Seoul gained 0.25 percent, or 5.08 points, to 2,046.96.
Hong Kong added 0.25 percent, or 65.87 points, to 26,760.53.
But Shanghai tumbled 6.42 percent, or 306.99 points, to 4,478.36.
Wall Street’s three main indexes rallied, with analysts attributing the gains mostly to the Federal Reserve’s policy announcement and pledge Wednesday from chair Janet Yellen that it will only gradually raise interest rates.
The comments eased worries about a sharp rise in borrowing rates in the world’s top economy and key driver of global growth.
The Nasdaq jumped 1.34 percent to a record high, while the Dow added 1.00 percent and the S&P 500 gained 0.99 percent.
Investors brushed off increasing worries about Greece’s future in the eurozone after talks between the bloc’s Eurogroup of finance ministers fell apart Thursday.
The meeting in Luxembourg aimed at breaking the five-month-old standoff was the latest failure to reach a compromise and leaves Athens with less than two weeks to unlock billions of euros in bailout funds to service its debts.
With Greece unwilling to agree to some austerity terms and creditors also not backing down, the country could end up defaulting, which could then lead to it leaving the eurozone.
‘Accident dangerously close’
Greek Finance Minister Yanis Varoufakis warned “an accident” in the bitter dispute was drawing “dangerously close,” while International Monetary Fund chief Christine Lagarde said progress required “adults in the room” in an apparent swipe at Athens officials.
Eurogroup chief Jeroen Dijsselbloem told a news conference: “It is still possible to find an agreement and extend the current program before the end of the month but the ball is clearly in the Greek court to seize that last opportunity.”
Despite the troubles the euro was only marginally lower. It bought $1.1345 compared with $1.1371 in New York, where it at one point hit a one-month high of $1.1436. The single currency was also at 139.40 yen on Friday against 139.78 yen in New York.
The dollar fetched 123.09 yen compared with 122.93 yen in US trade.
Eric Viloria, currency strategist for Wells Fargo Securities, said the euro gains came on reports suggesting Greece had obtained a delay in debt payments, but they were quickly pared when it became evident that was not the case.
The fact the euro did not lose all of its advances after the Eurogroup failure showed the market had not expected a deal, he said.
Chris Low, chief economist at FTN Financial, said he was “a little surprised” at the market’s response but added: “Maybe we fully priced in Greece leaving the euro.”
In Shanghai, traders scattered as nine companies issued new shares for subscription, which usually drains funds away from the existing market. The market regulator approved 24 initial public offerings earlier this month.
“The new share offers are the direct cause of the market selloff and it is very likely this is a mid-term market adjustment,” Haitong Securities analyst Zhang Qi told Agence France-Presse.
The regulator also last week tightened some rules for margin trading, through which investors borrow funds to trade stocks. It also prohibited dealers from raising funds outside of the margin trading channel to trade stocks.
On oil markets, US benchmark West Texas Intermediate for July delivery fell 14 cents to $60.31 while Brent crude for August gained five cents to $64.31 in afternoon trade.
Gold fetched $1,199.11 compared with $1,195.40 late Thursday.