Asia stocks rise on hopes for EU, US stimulus

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By PAMELA SAMPSON, Associated Press

BANGKOK (AP) — Asian stock markets rose Thursday, boosted by hopes that Europe is preparing to take action to tackle the region's financial crisis and comments from a Fed policymaker about possible support for the U.S. economy.

Benchmarks across Asia rose, including Japan's Nikkei 225 index, up 1.3 percent to 8,641.31 and Hong Kong's Hang Seng, which added 1.6 percent to 18,819.39.

Hopes for strong action by the U.S. central bank were lifted by comments from Atlanta Federal Reserve President Dennis Lockhart, who said Wednesday that sustained weakness in job creation could justify more action to support the economic recovery.

That helped traders overlook the disappointment that the ECB offered no new monetary stimulus on Wednesday, with its chief Mario Draghi saying it was the time for governments to act to restore confidence in the 17 nations that use the euro common currency.

Draghi, however, has left himself some room to maneuver, saying that "we'll monitor closely all the developments and we'll stand ready to act" if necessary. He also said some members of the 23-member council advocated a rate cut.

"This implies that rates cuts are in the pipeline very soon but any more action will require European politicians to act first," analysts at Credit Agricole CIB in Hong Kong said in a market commentary.

South Korea's Kospi index jumped 2.8 percent to 1,851.36 and Australia's S&P/ASX 200 added 1.5 percent to 4,116.60. Benchmarks in Singapore, Taiwan, mainland China, New Zealand and Indonesia also rose.

Traders will be closely watching Fed Chairman Ben Bernanke when he testifies before a congressional committee Thursday. Traders will be looking to see if he offers any hints that the Fed is considering more monetary stimulus.

Benchmark oil for July delivery was up 61 cents to $85.63 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 73 cents to settle at $85.02 in New York on Wednesday.

In currencies, the euro rose to $1.2569 from $1.2546 late Wednesday in New York. The dollar rose to 79.32 yen from 79.18 yen.

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