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Asia stocks rise on Spanish rescue package; Nikkei up 2.00%

Published 06/10/2012, 10:25 PM
Updated 06/10/2012, 10:27 PM
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Investing.com - Asian stocks rose on Monday amid a global risk-on trading session fueled by news that eurozone finance ministers agreed to arrange EUR100 billion in emergency funding for Spain to recapitalize its banks.

During Asian trading on Monday, Hong Kong's Hang Seng Index was up 2.17%, while Japan’s Nikkei 225 Index was up 2.00%.

Australian markets were closed on holiday

Spain has become the fourth eurozone country to seek emergency credit, following Greece, Portugal and Ireland, by accepting EUR100 billion.

The country had been facing increasing pressure to prop up its banking sector as well as heed calls from the regional government of Catalonia for help refinancing its debts, which sent yields in Spanish government debt auctions spiking to well over 6% and the euro weakening against the dollar.

Rating’s agency Fitch slashed Spain's credit rating by three notches to triple-B on Friday and warned further cuts could come if the country fails to stabilize its banking sector.

Reports that aid will flow into the country's financial sector sparked a global risk rally on Monday, which sent Asian stocks soaring.

While Greece and Portugal and Ireland have accepted emergency aid in the past, concerns that Spain, a much larger economy, was in trouble had sent stocks across Asia tumbling in recent sessions.

In Hong Kong, top gainers included China Life, up 4.65%, China Merchants Holdings, up 4.63%, and COSCO Pacific, up 4.58%.

Top Hong Kong decliners included Wharf Holdings, down 3.60%, MTR Corporation, up 0.32%, and CLP Holdings, up 0.60%.

European stock futures indicated a higher opening.

France's CAC 40 futures pointed to a gain of 1.35%, while Germany's DAX 30 futures signaled a gain of 1.74%. Meanwhile, in the U.K., the FTSE 100 futures indicated a gain of 1.45%.

Dow Jones Industrial Average futures were up 1.11% while the S&P 500 futures were up 1.12%.

On Monday in the eurozone, France will publish its latest industrial production figures, a key gauge of economic health.

In the U.S., Federal Reserve Bank of Chicago President Charles Evans is due to speak in public,

Japan will release manufacturing data as well as preliminary data on machine tool orders.
Bank of Japan Governor Masaaki Shirakawa is due to appear in public as well.






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