Asian stocks outside South Korea advanced on Friday supported by a rally in Chinese stocks following measures y Beijing to halt a month-long selloff and a positive lead from Wall Street overnight.
Chinese stocks ended the week with a two day rally on speculation that banks would support the market and the end of the Greece debt crisis after Athens voted to support the austerity measures by its international lenders.
“China has plenty of scope in terms of rates and reserve requirements to inject liquidity and hopefully stabilize the situation,” Andrew Belshaw, head of investments at Western Asset Management Co., an affiliate of Legg Mason Inc, told Market Watch.
“Still, the risk that the market continues to go down is a bigger risk than developments in Greece.”
The benchmark Shanghai Composite index added3.5% at 3975.36 points while the smaller Shenzhen composite added 5% to settle at 2190.40 points.
Hong Kong’s Hang Seng was set for its first weekly advance in more than five weeks after adding about 1.2% on the day.
The Japanese Nikkei advanced 0.2% on a softer yen while South Korea’s benchmark Kospi index shed 0.5% on concerns of disappointing second quarter corporate earnings.
The MSCI Asia Pacific index jumped 0.3% in Hong Kong to close at 144.74 points. The Index is headed for 2.6% gain this week on news than China Securities Finance Corp has more than 3 trillion Yuan ($438 billion) at hand to support equities.
“Don’t stand in front of the Beijing freight train,” Gavin Parry, Hong Kong-based managing director of Parry International Trading Ltd, told Bloomberg.
“As good measure into the last hour of Shanghai trading, there was news that the China Securities Finance Corp had 2.5-3 trillion yuan available to support stocks. There drops another bear carcass on the side of the Shanghai A road.”
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