Asia stocks mostly up, euro struggles on ECB stimulus

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HONG KONG: Asian markets mostly rose on Friday following gains in New York, while the euro remained stuck at 11-year lows after the European Central Bank said it would launch its massive stimulus program next week.

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While the euro struggled, the more upbeat mood provided support to the dollar ahead of the release later in the day of US jobs data, with a positive report seen supporting the Federal Reserve’s move to raise interest rates.

Tokyo climbed 1.17 percent thanks to a weaker yen. The Nikkei 225 index rose 219.16 points to close at 18,971 while Seoul closed 0.73 percent, or 14.56 points, higher at 2,012.9.

Sydney was flat, edging down 5.26 points owing to a decline in the price of iron ore, ending at 5,898.9.

Hong Kong gave up 0.12 percent, or 29.04 points, to 24,164 and Shanghai slid 0.22 percent, or 7.29 points, to 3,241.19, with investors subdued a day after China lowered its economics growth target for 2015.

ECB head Mario Draghi told a news conference that from Monday the bank would buy 60 billion euros ($66 billion) of private and public bonds each month for at least 18 months in a bid to ward off deflation.

He also said it had increased its 2015 eurozone growth forecast to 1.5 percent, followed by 1.9 percent in 2016 and 2.1 percent in 2017.

At the same time he forecast inflation at zero this year, lower than previously projected, but added it would pick up to 1.5 percent next year and to 1.8 percent in 2017.

The news pushed the euro below $1.10 in New York for the first time since September 2003 before it recovered slightly to end Thursday at $1.1028.

On Friday in Tokyo it bought $1.1015, well down from the levels around $1.12 at the beginning of the week.

The single currency also bought 132.35 yen compared with 132.50 yen in US trade.

European easing

“We now have details of European easing measures, and the yen’s maintaining 120 to the dollar, these factors should push up stocks,” Juichi Wako, a senior strategist at Nomura Holdings Inc. in Tokyo, said. “We’ll probably have a wait-and-see mood ahead of the US jobs report.”

The dollar was at 120.19 yen, against 120.14 yen in New York but up from 119.85 yen in Tokyo earlier Thursday.

Wall Street’s three main indexes broke a two-day losing streak to rally Thursday on the ECB announcement as well as a $21 billion tie up between pharma company AbbVie and drug maker Pharmacyclics.
The Dow added 0.21 percent, the S&P 500 rose 0.12 percent and the Nasdaq put on 0.32 percent.

Focus is now on Friday’s US non-farm payrolls figures. Analysts expect growth of 240,000 jobs in February and a fall in the unemployment rate to 5.6 percent from 5.7 percent.

Oil prices edged higher on heightened tensions in the crude-rich Middle East, analysts said.

US benchmark West Texas Intermediate added 25 cents to $51.01 while Brent gained 40 cents to $60.88 in afternoon trade.
Gold fetched $1,197.11 against $1,199.90 late Thursday.

AFP

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