HONG KONG (AFP) – Asian markets rallied for a second straight session Friday, boosted by another strong performance on Wall Street while renewed confidence helped push the dollar back towards the 100 yen mark.
Tokyo jumped 2.39 per cent, or 411.35 points, to 17,621.40 thanks to the weaker yen, while Sydney climbed 2.45 per cent, or 127.8 points, to close at 5,338.6 and Seoul advanced 1.71 per cent, or 32.48 points, to 1,929.98.
Hong Kong climbed 1.25 per cent, or 284.42 points, to 23,116.63 and Shanghai was up 1.67 per cent, or 51.08 points, at 3,108.60.
Global markets tanked at the start of the week on fears about the global economy as oil prices plunged and crude exporter Russia was also hammered by Western sanctions over Ukraine.
However, they have rebounded over the past few days in response to a Federal Reserve statement Wednesday indicating interest rates would be hiked no sooner than mid-2015.
On Wall Street the Dow surged 2.43 per cent, the S&P 500 shot up 2.40 per cent – the first time since 2002 the index has risen more than two per cent on successive days – and the Nasdaq gained 2.24 per cent.
The Fed’s stance brought relief to emerging markets, which have seen huge capital outflows as traders return to the United States in expectation of better returns.
Brokerage IG said it expects “emerging markets to continue their run as they track the momentum seen in major global markets”.
Currency traders have also returned to the dollar after it tumbled earlier in the week against the yen, which is considered a safe bet in times of turmoil.
The greenback – which fell to as low as 116.30 yen Wednesday – was at 119.22 yen Friday, compared with 118.81 yen in New York.
A slightly more upbeat assessment of the Japanese economy by the country’s central bank added to the positive mood, adding to selling pressure on the yen.
“Exports have shown signs of picking up” while factory output has started to “bottom out”, the BoJ said in a statement after a two-day policy meeting. “Japan’s economy is expected to continue its moderate recovery.”
The euro bought $1.2291 and 146.53 yen against $1.2287 and 146.00 yen in US trade
Oil prices tacked higher after plumbing new five-and-a-half-year lows Thursday on the back of a supply glut.
US benchmark West Texas Intermediate for January delivery rose 79 cents to $54.90, while Brent crude for February gained three cents to $59.30 in afternoon trade.
Gold was at $1,198.10 an ounce, compared with $1,210.13 late Thursday.