Asian stocks gained Tuesday, carrying on Monday’s rally. Equity indices in Japan, South Korea and Australia were seen climbing. But China’s Shanghai Composite remained volatile even in Tuesday’s trading.
Japan’s Nikkei 225 rebounded from a slow start on Monday and a Friday butchering that saw the index touch its two-month low. Nikkei 225 was seen rising 1.13%. Analysts see interest in Japanese shares driven by cheap banking stocks.
In South Korea, the Kospi added 0.5%, but the Shanghai index failed to follow the trend, going in the opposite direction instead and losing 0.5% in the process. The Shanghai Composite added 1.6% on the previous day. In Australia, shares gained 0.9%. The gain was mainly supported by commodity stocks.
The broader Asia-Pacific index that excludes Japanese stock was up 0.6%.
European stocks falling
European stocks opened Tuesday’s session on a low note. The Stoxx Europe 600 was seen down nearly 0.57%, having gained 0.3% on the previous day. The FTSE 100 was also down 0.21%. Germany’s DAX was also dosed, losing 0.08%.
European stocks were helped on the previous day by banks following the move by Italian regulators to help domestic banks so that they can deal with bad loans and continue lending to support the economy.
The dollar gained 0.4% to 108.34 against the Japanese yen, reversing Monday’s loss that saw the greenback touch a 17-month low of 107.63. Officials in Tokyo worried about yen’s strength exhibited in Monday’s trading and warned that measures would be taken to weaken the domestic currencies exchange rate. The officials talked about direct dollar sales. The dollar was flat against the Euro at 1.1411.
The Australian dollar edged up 0.4% to 0.7629 against the greenback. The Canadian dollar stood steady against the U.S. dollar at 1.2903, defending Monday’s 0.7% gain.
U.S. crude oil was quoted at $40.17 per barrel, comparing with the three-week high $40.75 reached Monday. The Brent crude jumped above $43 per barrel.
Spot gold XAU rose to a three-week high of $1,259.66 per ounce while spot silver XAG fell 0.4% following a 3.9% on the previous day.
The weaker U.S. dollar (CURRENCY:USD) has made dollar-denominated commodities cheaper for foreign buyers, thus explaining the surge in commodity prices.