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China stock markets rally after surprise rate cut

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China stock markets rally after surprise rate cut
China stock markets rally after surprise rate cut

5th February, 2015 Asia : 

China markets are rallying after the mainland’s central bank unexpectedly cut a key lending rate on Wednesday.

The People’s Bank of China lowered the required reserve ratio (RRR) for banks by 50 basis points in an attempt to stimulate the slowing economy.

The Shanghai Composite surged 2.4% and Hong Kong’s Hang Seng jumped 1.5%.

China stock markets rally after surprise rate cut
China stock markets rally after surprise rate cut

Other Asian markets are mostly down, however, after the European Central Bank moved to tighten Greece’s access to funding.

Japan’s Nikkei 225 fell 0.6% and the broader Topix lost 0.4% in early trade.

South Korea and Australian stocks are also in negative territory.

Analysts said the ECB was taking a hard-line stance and putting pressure on Greece to decide on a funding programme.

“Overall, we retain the view that an agreement between the Greek government and the EU remains possible, but the probability of a Greek exit is clearly now higher than at any time in 2012,” Barclays Research wrote in a report.

“The rise of radical parties in Europe, such as Podemos in Spain, leaves not much room to EU policymakers to be lenient on Greece’s requests.”

Stock Movers

Japanese technology giant Sony saw its shares surge by as much as 18% in Tokyo after the firm narrowed its full-year loss forecast.

Australia’s fourth-biggest bank also got a lift from a positive earnings report, rising by 1.4% in Sydney.

National Australia Bank said its quarterly cash profit rose 6% to $1.3bn on increased mortgage lending.

Shares of Taiwan’s TransAsia Airways fell for a second day after the company suffered its second fatal crash in under a year.

Flight 235 crashed shortly after takeoff from a Taipei airport on Wednesday, killing at least 31 people and injuring more than a dozen others.

TransAsia stock fell nearly 5% in Taipei after having lost 6.9% yesterday.

 

Source : BBC

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