Asian stocks rise as Greece nears debt resolution (AP)

June 30, 2011

BANGKOK – Asian markets moved higher Thursday, a day after Greece approved a harsh austerity package to prevent the heavily indebted country from a massive default.

Oil prices rose above $95 a barrel while the dollar sank against the euro and the yen.

Japan’s Nikkei 225 rose 0.3 percent to 9,824.01, Some export shares dropped on a strengthening yen. Isuzu Motors Ltd. lost 1.6 percent while Mitsubishi Motors Corp. shed 1 percent.

South Korea’s Kospi index rose 0.5 percent to 2,104.63, while Hong Kong’s Hang Seng was 1.7 percent higher to 22,436.78. Australia’s S&P ASX 200 rose 1.7 percent to 4,604.10.

Banking shares in Asia followed their U.S. counterparts higher. Hong Kong-listed Agricultural Bank of China, the country’s biggest rural lender, rose 2.3 percent. China Construction Bank Corp. gained 1.9 percent. National Australia Bank Ltd. was 1.6 percent higher and Mitsubishi UFJ Financial Group Inc. jumped 2.4 percent.

Oil-related stocks also posted gains as crude prices marched upward. Hong Kong-listed PetroChina Co. Ltd., the publicly traded unit of China’s biggest oil and gas company, rose 1.4 percent.

Greece’s approval on Wednesday of austerity measures needed to avert default next month was a decisive step for the country to get the next batch of bailout loans from international creditors and was met with a huge sigh of relief in markets.

A Greek default could potentially trigger a banking crisis and turmoil in global markets. Another bill has to be passed Thursday for the government to secure the money.

“Investors are going to the market to pick up good bargains that have surfaced over the past few days of selling,” said Lee Kok Joo, head of research at Phillip Securities in Singapore. “With the debt crisis out of the way, investors are going to the market.”

Shares in Chinese auto and battery maker BYD Co. jumped 44 percent in their debut on the Shenzhen Stock Exchange, despite news that the company’s profit fell by 84 percent in the first quarter. BYD, whose name stands for Build Your Dreams, said the plunge in its first quarter profit was mainly due to weak auto sales.

MidAmerican Energy, a subsidiary of billionaire investor’s Warren Buffett’s Berkshire Hathaway, holds a 9.9 percent stake in BYD.

On Wall Street, stocks closed higher for the third day in a row Wednesday. The Dow Jones industrial average rose 0.6 percent to close at 12,261.42. The Standard & Poor’s 500 index rose 0.8 percent to 1,307.41. The Nasdaq composite rose 0.4 percent, to 2,740.49.

Financial companies in the S&P 500 rose 2.1 percent after Bank of America Corp. reached an $8.5 billion settlement with investors over claims it sold them bad loans. The investors said Bank of America violated agreements with them by selling them low-quality mortgage-backed securities that lost value when the housing market collapsed. Much of the losses stem from BofA’s 2008 purchase of the troubled lender Countrywide.

Bank stocks also got a lift from news that the Federal Reserve plans to limit the fees banks can charge retailers for swiping debit cards to 21 cents. That’s higher than the 12 cents the Fed first proposed.

Benchmark crude for August delivery was 39 cents higher at $95.16 per barrel on the New York Mercantile Exchange. The contract settled at $94.77 per barrel on the Nymex on Wednesday.

The euro rose to $1.4512 from $1.4428 late Wednesday. The dollar weakened to 80.38 yen from 80.91 yen.

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