A trader reacts as he looks at computer screens at the Madrid Bourse. Spain and Italy both introduced short-selling bans on Monday, reacting to steep falls in their stock markets and as confidence slipped in their ability to repay their debts, prop up their banking systems and tend to their economies while remaining within the euro currency. - AP photo

BANGKOK: Asian stock markets rose again Monday as expectations remained high for strong European Central Bank action to stem the continent's chronic debt crisis. Sentiment was also helped by US second quarter growth not slowing as much as feared.

The world's No. 1 economy grew just 1.5 per cent in the April-June quarter after 2 per cent growth the previous quarter but some analysts had predicted a bigger slowdown.

Markets are pregnant with speculation that the ECB will resume buying government bonds to lower the borrowing costs of struggling countries such as Spain and take other major steps to support the region's economy.

Investors hope such moves would prevent Spain from being forced to seek a bailout that would be much more expensive than earlier rescues of Portugal, Greece and Ireland. A major Spanish crisis could imperil the euro currency union and in turn tip the world economy into recession.

Global markets were roiled early last week as Spain's borrowing costs soared but rallied after ECB chief Mario Draghi on Thursday vowed that the central bank was ready to do what it takes to keep intact the euro currency shared by 17 European nations.

A day later, German Chancellor Angela Merkel and French President Francois Hollande said they too would safeguard the euro.

The ECB's next scheduled meeting is Thursday.

Meanwhile, US Treasury Secretary Timothy Geithner will meet Monday with Draghi and Germany's finance minister to discuss the challenges facing Europe and the global economy.

''There is high expectation that the European Central Bank may reactivate its bond purchase program again to prevent Spain from evolving into a full-blown crisis,'' analysts at Singapore's DBS Bank said in a report.

Japan's Nikkei 225 stock average was up 0.7 per cent at 8,594.55 and Hong Kong's Hang Seng added 1.5 per cent to 19,568.86. Australia's S&P/ASX 200 climbed 0.9 per cent to 4,246.60 and South Korea's Kospi rose 0.8 per cent to 1,844.08. China's Shanghai Composite fell 0.1 per cent to 2,125.95.

In energy trading, benchmark crude for September delivery was up 58 cents at $90.71 a barrel in electronic trading on the New York Mercantile Exchange. The contract added 74 cents on Friday to finish at $90.13 per barrel in New York.

In currencies, the euro was down 0.2 per cent at $1.229. The dollar fell 0.1 per cent to 78.35 yen.

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