Asia: Stocks rally on prospect of more stimulus

Asian equity markets ended the week on an upbeat note, boosted by the prospect of more stimulus from the European Central Bank.

At the press conference following the European Central Bank rate announcement on Thursday, president Mario Draghi said the governing council had discussed expanding its bond-buying programme and cutting the rate on reserves held at the central bank.

“Although there might well be some debate as to the direct benefits of a change to already record-low interest rates, this once again proves that under Mario Draghi the ECB is acting rather than just venting rhetoric,” said Alastair McCaig, senior market analyst at IG.

The Shanghai Composite Index closed up 1.30%, while Hong Kong’s Hang Seng Index rose 1.34%.

September house price data in China showed prices were up in 39 cities last month versus August, marking the first time in 17 month prices have risen in more than half of Chinese cities.

Meanwhile, the latest survey from the Conference Board showed its index rose 1.6% month-on-month in September compared with a 1% gain in August and a 0.9% climb in July.

Japan’s Nikkei Stock Average rallied 2.11%, extending its weekly gains to 3%. The index has risen 11% since 29 September, with investors buoyed by the prospect of more easing policies.

Among individual stocks, Honda Motor shares rose 4.02%, while electronics-parts maker Murata Manufacturing gained 3.83% and semiconductor production equipment maker Tokyo Electron climbed 2.56%.

Elsewhere, Australia’s S&P/ASX 200 rose 1.67%, reaching its highest level since August, while South Korea’s Kospi climbed 0.86% to its highest level since July.

On the currencies front, the yen gained 0.35% against the dollar after falling to its lowest level against the greenback in over a month earlier in the session.

The Malaysian ringgit and the Indonesian rupiah both rose 0.7% against the dollar, while the Australian dollar climbed 0.78% against its US counterpart.