Asian Stocks Advance on China Rebound, Greek Bailout Proposal

Updated on

Asian stocks rose, following gains in global markets, as Chinese equities rebounded for a second day and Greece submitted a bailout plan similar to that proposed by its creditors.

China Huishan Dairy Holdings Co. surged 16 percent in Hong Kong to lead gains on the regional benchmark index after the milk producer’s parent bought shares in the company. BYD Co. jumped 11 percent, with the Warren Buffett-backed electric-car maker paring its fourth straight weekly drop. Fast Retailing Co. tumbled 6 percent in Tokyo after the apparel retailer said unseasonably cool weather has damped demand for summer clothes.

The MSCI Asia Pacific Index climbed 0.5 percent to 141.38 as of 6:56 p.m. in Hong Kong. It’s still set for a 3.5 percent drop this week. Greece’s package includes pension savings and tax increases as part of its bid to remain in the euro. European Union leaders will discuss the proposal Sunday. The Stoxx Europe 600 Index jumped 2.2 percent on Thursday, while the Standard & Poor’s 500 Index added 0.2 percent, as a rebound in Chinese equities also boosted sentiment.

“Signs that the proposal Greece has put together has concessions on longstanding issues and is similar to tabled proposals is reducing risk aversion,” Sam Tuck, a senior currency strategist in Auckland at ANZ Bank New Zealand Ltd., said by instant message. “The fact that China managed to close up across the board has certainly reduced market fear, but it’s still very much in the forefront of people’s minds.”

The Shanghai Composite Index advanced 4.5 percent, capping the benchmark index’s biggest two-day gain since 2008, as unprecedented government intervention helped curb an equity rout that erased $3.9 trillion in less than a month. The Hang Seng China Enterprises Index of mainland shares traded in Hong Kong climbed 3.6 percent.

China’s Steps

China’s securities regulator this week banned major shareholders, corporate executives and directors from selling stakes in listed companies for six months, its latest effort to stem the equities slump.

Hong Kong’s Hang Seng Index increased 2.1 percent. Japan’s Topix index added 0.2 percent as the yen weakened. South Korea’s Kospi index gained 0.2 percent. Singapore’s Straits Times Index advanced 0.4 percent. Australia’s S&P/ASX 200 Index rose 0.4 percent. New Zealand’s NZX 50 Index lost 0.2 percent.

Taiwan’s stock and bond markets were shut Friday as a typhoon approaches the island. Schools and government offices were closed in five cities in Taiwan, including Taipei and Taoyuan.

The International Monetary Fund cut its forecast for global growth this year, citing a weaker first quarter in the U.S., and expressed confidence financial-market turbulence from China to Greece won’t cause widespread damage.

E-mini futures on the S&P 500 advanced 1.3 percent.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE