Nov. 14 - Asian stocks rally Monday on hopes newly installed leaders in Italy and Greece will take quick action to save their indebted nations. Arnold Gay reports.
Asian stocks opened the week higher (Monday, November 14) on hopes newly installed leaders in Italy and Greece will take quick action to save their indebted nations, and fend off a wider financial meltdown in the euro zone. Commodities, the euro and risk-related currencies rose as events in Europe went according to plan, with Mario Monti appointed to lead a new Italian government, and Lucas Papademos sworn in as the new Greek prime minister. Binay Chandgothia of Principle Global Investors says both are technocrats, more inclined to fix problems than get involved in politics. SOUNDBITE (English) PRINCIPAL GLOBAL INVESTORS PORTFOLIO MANAGER, BINAY CHANDGOTHIA, SAYING: "The expectation is the decision making will move over from being politically-induced to be more economic-oriented. That is why you know the markets have taken it well. A lot needs to be done, the challenges remain in both Italy and Greece. And over the next month or two, you will get a better sense of how well positioned the new governments are in terms of addressing the real concerns." Japan's Nikkei 225 rose over one percent, with investors were reluctant to push harder ahead of an Italian bond sale later Monday that would gauge market sentiment towards Italy. Japan's top three banks led gains ahead of earnings due after markets shut. Stocks outside of Japan fared better, continuing a rebound that started late last week. Financials lifted the Shanghai composite by nearly two percent, and banking giant HSBC led the rally in Hong Kong. Consumer stocks Tingyi and Want Want also rose Monday (November 14) on news they would be included in the benchmark Hang Seng Index in December. In Seoul, blue chip technology names like Hynix and LG Display led the outperformers, as foreign investors returned after three days of selling. The South Korean benchmark Kospi added nearly 40 points to close two percent higher, near the key 1,900 level. Arnold Gay, Reuters.