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Asia: Shares mostly higher, Greece talks in focus
[HONG KONG] Asian markets mostly rose in early trade Wednesday as hopes grew for a breakthrough from crucial meetings at which Greece will try to convince its European creditors to renegotiate terms of its bailout.
Dealers were given a positive lead from New York and Europe, even after Greece's combative leaders vowed not to bow to German-led pressure to complete an austerity-laden agreement, leading to fears Athens will default and exit the eurozone.
Hong Kong was 0.65 per cent higher, Seoul added 0.47 per cent, Shanghai put on 0.20 percent and Taipei gained 0.69 per cent while Sydney eased 0.62 per cent.
Tokyo was closed for a public holiday.
Wednesday will see a meeting of eurozone finance ministers following by a summit of leaders Thursday. At the talks Greece's new leadership will present a plan aimed at rewriting some of the terms of a 240 billion euro (US$270 billion) bailout.
Prime Minister Alexis Tsipras and Finance Minister Yanis Varoufakis are asking for stop-gap financing with a view to clinching a reform deal to run from September 1.
They are expected to offer a series of measures including lower budget surplus targets and cutting debt through a swap plan to replace its current EU-IMF bailout obligations.
And Tsipras said Tuesday he would not request more bailout cash under the current terms, despite pressure from German Finance Minister Wolfgang Schaeuble.
"I want to repeat today, no matter how much Schaeuble asks it, we are not going to ask to extend the bailout." However, Schaeuble said earlier in the day that "it's over" if Greece does not want the final tranche of the aid programme, according to Bloomberg News.
While the European leaders seem to be at loggerheads, analysts said investors were still confident a deal will be reached.
"The markets don't see a Greek exit as highly likely and certainly don't think there's a really negative outcome looming," Mark Lister, head of private wealth research at Craigs Investment Partners Ltd, told Bloomberg News.
"There are still a lot of risks out there but then again the world is growing very slowly, interest rates are at zero and central banks remain stimulatory so equities can still grind higher, just with more volatility." In New York shares rallied on hopes for a positive outcome, while a surge in Apple to a record high as well as upbeat earnings results also provided support. The Dow climbed 0.79 per cent, the S&P 500 gained 1.07 per cent and the Nasdaq jumped 1.30 perc ent.
Frankfurt and Paris surged more than one per cent, while London edged up. Athens soared nearly eight per cent.
On currency markets the euro fetched US$1.1328 and 135.38 yen, against US$1.1315 and 135.15 yen in New York.
The dollar bought 119.51 yen, compared with 119.44 yen.
Oil prices rebounded after suffering a sell-off Tuesday. US benchmark West Texas Intermediate for March delivery was up 70 cents to US$50.72 a barrel and Brent crude for March advanced 42 cents at US$56.85 in mid-morning trade.
Gold fetched US$1,235.19 an ounce, against US$1,237.42 on Tuesday.