Asian markets jump on US jobs figures

Published Aug 07, 2012 12:11am

HONG KONG, Aug 6: Asian markets rebounded strongly on Monday on better-than-expected US jobs data while traders took a more positive view of the European Central Bank’s position on the eurozone debt crisis.

The single currency hit its highest level against the dollar in a month as concerns over the eurozone and the US eased; while hopes grew that Greece will meet its obligations to qualify for another tranche of rescue cash.

Tokyo rose 2.0 per cent, or 171.18 points, to 8,726.29, Seoul climbed 2.01 per cent, or 37.20 points, to 1,885.88 and Sydney closed 1.21 per cent, or 51.1 points, higher at 4,272.6. Hong Kong jumped 1.69 per cent, or 332.54 points, to 19,998.72 while Shanghai added 1.04 per cent, or 22.12 points, to close at 2,154.92.In the US, the Labour Department said on Friday that the economy added 163,000 jobs in July — the strongest gain since February and beating forecasts for a gain of 100,000. Despite a 0.1 percentage point rise in the unemployment rate to 8.3 per cent the figures were welcomed by investors who took the report as a sign of resilience in the world’s number one economy.

The result sent Wall Street surging. The Dow jumped 1.69 per cent, the Nasdaq climbed 2.00 per cent and the S&P 500 rose 1.90 per cent. The figures were welcome news for the markets, which had been sent tumbling on Thursday after the ECB failed to announce any concrete plans to support the euro, despite comment from its head Mario Draghi that it would do whatever was needed.

However, the initial disappointment was reversed in Europe and on Wall Street after bank officials said on Friday it could intervene and buy the bonds of struggling eurozone countries without unanimous approval. Those comments raised hopes that a bond buying programme to help struggling countries such as Spain and Italy is still possible.

The ECB “seems to be cooking up something internally”, Jung Seung-jae, analyst at Mirae Asset Securities in South Korea, told Dow Jones Newswires.

“Action may come earlier than expected.” On currency markets the euro surged in early trade to a one-month high of $1.2442 as traders became more confident in higher-risk, higher-yielding assets. The unit later eased back to $1.2350 in early European trade, compared with $1.2381 in late trade in New York on Friday.—AFP

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