Asian stocks surged by the most this week in more than two years after a breakthrough in Europe boosted confidence the debt crisis will be contained and China hinted at easing monetary policy.
“Markets have been very oversold on the Europe’s debt concern, so development in the region’s debt talks and positive economic data from the US forced people to cover their shorts this week,” Tokio Marine & Nichido Fire Insurance Co’s Shintaro Takeuchi said.
The MSCI Asia Pacific Index surged 7.5 percent this week, its steepest weekly advance since the period ended May 8, 2009, after European leaders talked bondholders into accepting writedowns on Greek debt and boosted a regional rescue fund’s capacity.
The Asian benchmark’s surge this week pared its loss this year to about 9.5 percent. The gauge has jumped 10 percent this month.
Taiwan’s benchmark TAIEX gained 4.98 percent for the week, closing at 7,616.06 on Friday.
Japan’s Nikkei 225 Stock Average rose 4.3 percent after the nation’s exports increased more than expected last month and after the Bank of Japan expanded a credit program from ¥50 trillion (US$660 billion) to ¥55 trillion.
Hong Kong’s Hang Seng Index jumped 11 percent this week, exiting a so-called bear market after climbing more than 20 percent from a two-year low reached on Oct. 4. The Shanghai Composite Index gained 6.7 percent after a report China’s manufacturing may expand for the first time in four months. South Korea’s KOSPI rose 5 percent, while Singapore’s Straits Times Index advanced 7.1 percent.
Australia’s S&P/ASX 200 gained 5.1 percent. The nation’s main bourse was shut for four hours on Thursday because of a network error, leaving traders unable to react to the news of Europe’s debt deal.
In other markets on Friday:
Manila closed 1.55 percent, or 66.22 points, higher from Thursday at 4,333.72.
Mumbai rose 2.98 percent, or 515.97 points, from Thursday to 17,804.9.
Wellington gained 0.67 percent, or 22.13 points, from Thursday to 3,325.60.
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