The Dow posted its best gains of the year and added more than 300 points which is 2.2%. Similarly, the S&P 500 and the NASDAQ advanced more than 2% and according to some market analysts Washington didn’t even need to finalize a debt ceiling deal to convince investors to buy stocks again for the euphoria.
They consider that the reason behind the euphoria is that House Republicans offered a proposal to raise the debt ceiling temporarily even when the government would remain partially shut down. The proposal seems to have rippled throughout the financial markets and better performance of indices. However, the CBOE’s Volatility Index (VIX) or the VIX dropped 16%.
Asian Stocks Fare Better Comparatively
In today’s trading Asian stocks rose comparatively higher and the regional index heading for the biggest gain in three weeks. This all is happening amidst optimism U.S. lawmakers will lift the debt limit and avoid a default. On a better trading day, Great Wall Motor Co. was the major gainer that added 2.6 percent in Hong Kong after the carmaker reported sales increased last month.
Similarly, Westpac Banking Corp. gained 2.5 percent in Sydney after agreeing to buy Lloyds Banking Group Plc’s assets in Australia and helped the regional stock gauge’s advance. However, it was not a good trading day for Fast Retailing Co., Asia’s largest clothing retailer as it fell 3.8 percent in Tokyo after forecasting profit that missed the set target.
Amidst the news that the U.S. lawmakers are willing to resolve debt limit issue to avoid a default, Asia and European index futures and Asian stocks rose to an extent; however, the growth was not remarkable. The prices of zinc and gold climbed with emerging-market currencies and Euro Stoxx 50 contracts added 0.3 percent by 7:08 a.m. in London.
Similarly, the MSCI Asia Pacific Index was up 1.3 percent; thus, it was its fourth day increase and the longest rally in a month. It jumped to 140.77 as of 2:17 p.m. in Tokyo and according to traders it may advance the highest since Sept. 19. Whereas Singapore’s Straits Times Index added 0.6 percent, Hong Kong’s Hang Seng Index (HSI) was upbeat with a gain of 1.2 percent.
Japan’s Topix Index surged 1.5 percent. Similarly, South Korea’s Kospi index climbed 1.2 percent. Indexes from New Zealand and Australia fared well today; while New Zealand’s NZX 50 Index gained 0.5 percent, Australia’s S&P/ASX 200 Index rallied 1.6 percent.
To contact the reporter of this story: Jonathan Millet at firstname.lastname@example.org