You are here

Asia: Most markets up as rally presses ahead

15947597 - 09_05_2010.jpg

[HONG KONG] Asian markets mostly extended their rally on Tuesday with Tokyo boosted by a jump in the dollar against the yen after a top Federal Reserve official said the bank could lift interest rates as soon as next month.

With Wall Street's trading floors closed for the Presidents Day holiday there was little to drive business but the optimism that was prevalent last week continued to flow in early exchanges.

Europe provided a tepid lead with hopes of a bailout deal for Greece tempered by signs of growing anti-EU sentiment in France ahead of the presidential election in April and May.

In Tokyo the Nikkei index ended the morning session 0.5 per cent higher as exporters were lifted by the weaker yen.

Market voices on:

The dollar climbed to 113.46 yen from 113.09 yen on Monday following comments from the head of the Fed's Philadelphia branch, Patrick Harker, that a March rate rise was not "off the table at this point".

Expectations of a hike have increased since Donald Trump was elected president in November as dealers bet his big-spending, tax-cutting plans will fan inflation. And the latest reading on prices increases, as well as healthy jobs growth and factory activity, have reinforced that view.

Hong Kong added 0.2 per cent in the morning and Shanghai was up 0.3 per cent while Seoul put on one per cent. Sydney was flat while Singapore dipped 0.1 per cent.

On currency markets Stephen Innes, senior trader at OANDA, said the euro "traded a little heavy, but with much ink spilled over the French elections, (it) has held remarkably well.

"Traders donned their noise-cancelling headphones, not wanting to get emotionally caught in EU political melodrama at this stage."

Investors are keeping an eye on the release this week of Fed minutes from its most recent policy meeting hoping for fresh clues about its plans for rates, while preliminary factory figures are also due this week from the US and Europe.