Asian stocks climbed, with the regional benchmark index having its biggest weekly gain since April, as central banks signaled looser monetary policies to blunt the impact of Britain’s decision to leave the EU.
The MSCI Asia Pacific Index rose 0.6 percent to close at 129.63 and advanced 3.5 percent over the past five days as the region’s equities rebounded from losses caused by the UK’s shock vote last week.
Bank of England Governor Mark Carney signaled the central bank could cut interest rates within months to shield the British economy, while the European Central Bank is considering loosening the rules for its bond purchases to ensure enough debt is available to buy, according to eurozone officials familiar with the matter.
“Markets are reacting positively to the supportive interest rate environment,” First NZ Capital Group Ltd Auckland-based director of economics and strategy Chris Green said by telephone.
“With interest rates remaining low for longer, the concern is what policy options are left for central banks if we see an even softer patch for the global economy,” Green added.
Shares in Taiwan on Friday maintained their momentum from the previous session, closing above the 8,700-point mark, as foreign institutional investors who held a large number of long position contracts in the futures market continued to buy in the spot market, dealers said.
Interest focused on large-cap stocks throughout the session, in particular in the bellwether electronics sector, led by Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the most heavily weighted stock on the local market, dealers said.
Sentiment improved as investors saw an upturn in equities on Wall Street and European markets, dealers said.
The weighted index on the Taiwan Stock Exchange closed up 71.66 points, or 0.83 percent, at 8,738.24 on Friday, up by 261.25 points from 8,476.99 on June 24.
Japan’s TOPIX added 0.7 percent, capping its biggest weekly advance since April. The yen gradually pared gains as speculation grows for further easing after the country’s top policymakers and the Bank of Japan expressed concern over the tumult in financial markets.
The country’s consumer prices continued to slide in May, putting more pressure on the Bank of Japan to expand monetary stimulus at its meeting later this month.
China’s stocks capped their biggest weekly gain in a month after official manufacturing data matched forecasts and a gauge of services activity perked up. The Shanghai Composite Index rose 0.1 percent, taking this week’s advance to 2.7 percent and erasing losses sparked by the UK referendum.
The Philippine Stock Exchange Index gained 0.4 percent, bringing its weekly advance to 2.6 percent and also erasing Brexit-related losses. The nation’s equities are at the highest in more than a year on optimism Philippine President Rodrigo Duterte, who took office on Thursday, will speed infrastructure development.
South Korea’s KOSPI rose 0.9 percent, Australia’s S&P/ASX 200 Index gained 0.3 percent and New Zealand’s S&P/NZX 50 Index increased 0.4 percent. Singapore’s Straits Times Index fell 0.1 percent, paring this week’s advance to 3.7 percent.
Markets in Hong Kong and Thailand were closed for holidays.
The Jakarta Composite Index slipped 0.7 percent, paring this week’s gain to 3.1 percent. The gauge entered a bull market this week after the passing of a tax amnesty bill that is forecast to lure more than US$40 billion of undeclared money back to Indonesia.
Nitori Holdings Co jumped 7.9 percent in Tokyo after the discount furniture retailer reported a 31 percent increase in quarterly operating profit and Nomura Holdings Inc raised its price target.
Sysmex Corp climbed 5.3 percent after the medical equipment maker raised its stake in Riken Genesis Co, as it seeks to expand into genetic research.
Additional reporting by staff writer, with CNA
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