Asian Stocks Show Recovery Signs

Leading markets in Asia have climbed, helped by a number of governments who have intervened to try to boost their economies and avert a recession.The MSCI index in the Asia-Pacific region rose 5.9%. India’s Sensex rose some 440 points or 4.6% after a cut in short-term interest rates.Hong Kong’s Hang Seng index rose 3% on hopes that lending limits would been lifted, helping small firms.

But traders were cautious, saying uncertainty remained in the market.”There is still widespread scepticism over the steps taken to unfreeze the credit markets, as it will be a while before things start looking up on a sustained basis,” brokerage India Infoline said following the rate change in India.

Confidence

South Korea announced an 11-trillion-won economic stimulus package on Monday that helped send shares in Seoul 1.4% higher.Miles Remington, head of Asian sales trading at BNP Paribas Securities in Hong Kong, said: “I don’t think it’s a massive change in direction.”More a case of a little more confidence going forward in massively oversold stocks and … global organized attempts to deal with the issues,” he said.

Finance firms were among the main climbers, with China’s ICBC up nearly 10%, Indian lender ICICI adding 8% and Australia’s investment bank Macquarie rising 12.4%.Central banks in the US, Japan, China, as well as India, have all cut borrowing costs to boost their economies in the last week.There are growing expectations that the Bank of England and the European Central Bank will follow suit this week.