Arab Today, arab today asia stocks surge on ecb move
Last Updated : GMT 04:33:45
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Oil rallies on Saudi king death

Asia stocks surge on ECB move

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Arab Today, arab today Asia stocks surge on ECB move

General view of trading floor of Hong Kong stock exchange
Riyadh - Arab Today

Asian equity markets rallied Friday after the European Central Bank announced a huge cash injection to kickstart the eurozone economy, while crude prices surged on news the monarch of oil kingpin Saudi Arabia had died.
The ECB's unprecedented decision to pump tens of billions of dollars a month into financial markets sent the euro plunging to 11-year lows against the dollar and also fuelled a buying spree in US and European stock markets.
Tokyo jumped 1.05 percent, or 182.73 points, to 17,511.75 and Sydney added 1.51 percent, or 81.86 points, to 5501.80, with energy firms lifted by the stronger oil prices. Seoul gained 0.79 percent, or 15.27 points, to 1,936.09.
In afternoon trade Hong Kong was 1.28 percent higher and Shanghai added 1.20 percent.
After a much-anticipated policy meeting Thursday ECB chief Mario Draghi said it would buy 60 billion euros a month of private and public bonds from
March until September 2016. Analysts had forecast 50 billion euros.
The programme, known as quantitative easing (QE), had been widely predicted following a string of weak inflation figures out of the eurozone that culminated in a fall in prices in December for the first time in five years.
That sparked fears of a spiral of deflation and a long period of anaemic economic growth in the 19-nation currency bloc.
"Market expectations were high and Draghi managed to surprise even the highest of expectations," Nader Naeimi, Sydney-based head of dynamic asset allocation at AMP Capital Investors, told Bloomberg News.
"It clearly puts the ECB on the front foot. It should help to stabilise European growth."
The announcement means the bank will effectively be printing more euros, hammering demand.
At one point Thursday the single currency tumbled to an 11-year low of $1.1316 before recovering slightly to $1.1359 by the end of the day. On Friday afternoon it bought $1.3429.
It was also at 134.33 yen Friday, against 134.63 yen in US trade and well down from 136.80 yen earlier Thursday in Asia.
The dollar was at 118.56 yen compared with 118.52 yen in New York.
The two main global crude contracts surged Friday following the death of King Abdullah of Saudi Arabia, the key member of the OPEC cartel that has refused to lower production despite a supply glut.
In afternoon Asian trade on Friday, US benchmark West Texas Intermediate for March delivery was up 90 cents, or 1.94 percent, at $47.21 a barrel. Brent crude for March jumped $1.03, or 2.06 percent, to $49.55.
King Abdullah bin Abdul Aziz was replaced by Crown Prince Salman, the royal court said in a statement.
"As we are uncertain of how the new king would react to the current supply glut, we believe that the market is pricing in this uncertainty, causing prices to spike," said Daniel Ang, an investment analyst with Phillip Futures in Singapore.
The jump in prices comes as a relief to energy firms after months of sharp falls caused by weak global demand, an oversupply of the black gold and OPEC's decision last year to maintain production levels.
Saudi Arabia rejected calls from some members to slash output, preferring instead to lower prices in a bid to gain market share.
Among Asian energy companies Sydney-listed Woodside jumped 2.32 percent and Santos rallied 5.12 percent by the end of the day, while in Tokyo Inpex climbed 1.63 percent.
In afternoon Hong Kong trade PetroChina was 1.84 percent higher and Sinopec added 1.12 percent.
Gold fetched $1,295.40 an ounce, against $1,286.66 late Thursday.
Source: AFP

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