[h=3]By DANIEL INMAN[/h]Asian markets rose Friday on reassurance from European Central Bank President Mario Draghi that "the ECB is willing to do whatever it takes to preserve the euro," while South Korea was among the strongest performers following Samsung Electronics's earnings report.
During a speech in London, Mario Draghi gave his strongest signal to date that the central bank is poised to undertake massive purchases in the euro-zone bond market if the situation worsens.
"These comments are very positive," said Shane Oliver, head of investment strategy and chief economist at AMP Capital. "It has always been within the power of the ECB to bring an end to financial panic sweeping Europe."
The comments were made against a backdrop of climbing Spanish bonds yields, which reached a euro-era high of 7.7% on Wednesday, creating worries that the bank bailout agreed on in June might not be sufficient to stabilize Spain's ailing economy.
The next step will be to see whether the ECB will deliver, as attention shifts to the central bank's policy meeting next week. There are also rising hopes that the U.S. Federal Reserve could also undertake more monetary stimulus when its Federal Open Market Committee meets next week.
"Draghi assured investors ahead of the monetary policy meeting next week, so investors may wait and see what it actually does before selling," said Kim Chul-jung, analyst at Korea Investment & Securities.
At $1.2276, the euro softened slightly in Asian trading, after rising 1% on Thursday—the currency's best session since late June.
Asian currencies were also boosted by the comments. The dollar weakened against the South Korean won, to 1,140, compared with 1,146 late Thursday, and the Australian dollar climbed closer to regaining the $1.04 mark, at $1.0394 early on Friday.
At ¥78.27 to the dollar, the yen stayed close to the ¥78 level. There are fears that the stubbornly strong Japanese currency could force the central bank to intervene, with economists suggesting that a fall below ¥77 could trigger a response.
South Korea led the gains, with the Kospi up 1.7%, as index heavyweight Samsung Electronics announced a record net profit for the second quarter. In contrast to the disappointing Apple results earlier this week, shares in the technology giant climbed 3.5% after the company reported that its mobile devices continued to sell well during the global economic downturn. Analysts are already predicting that there could be another record result in the third quarter.
Japan's Nikkei Average gained 1.3%, as HSBC and Chinese banks all made substantial gains. The Shanghai Composite was just 0.3% higher.
In company news, Toshiba gained 3.7% in Tokyo after a Nikkei report said that strong performance in its infrastructure segment helped push the company's April to June operating profit higher.
Also in Japan, Nissan Motor gained 2.8%, despite reporting a smaller-than-expected first quarter operating profit, as investors bought amid expectations that the company's earnings are expected to bottom in the first half.
In Hong Kong, AIA Group gained 1.9% after the insurer reported above-view results for the first half of the year. Analysts point out that the company has already achieved 68% of its forecast earnings for the financial year, and the company is doing well with its investments despite market volatility.
Write to Daniel Inman at [email protected]
During a speech in London, Mario Draghi gave his strongest signal to date that the central bank is poised to undertake massive purchases in the euro-zone bond market if the situation worsens.
"These comments are very positive," said Shane Oliver, head of investment strategy and chief economist at AMP Capital. "It has always been within the power of the ECB to bring an end to financial panic sweeping Europe."
The comments were made against a backdrop of climbing Spanish bonds yields, which reached a euro-era high of 7.7% on Wednesday, creating worries that the bank bailout agreed on in June might not be sufficient to stabilize Spain's ailing economy.
The next step will be to see whether the ECB will deliver, as attention shifts to the central bank's policy meeting next week. There are also rising hopes that the U.S. Federal Reserve could also undertake more monetary stimulus when its Federal Open Market Committee meets next week.
"Draghi assured investors ahead of the monetary policy meeting next week, so investors may wait and see what it actually does before selling," said Kim Chul-jung, analyst at Korea Investment & Securities.
At $1.2276, the euro softened slightly in Asian trading, after rising 1% on Thursday—the currency's best session since late June.
Asian currencies were also boosted by the comments. The dollar weakened against the South Korean won, to 1,140, compared with 1,146 late Thursday, and the Australian dollar climbed closer to regaining the $1.04 mark, at $1.0394 early on Friday.
At ¥78.27 to the dollar, the yen stayed close to the ¥78 level. There are fears that the stubbornly strong Japanese currency could force the central bank to intervene, with economists suggesting that a fall below ¥77 could trigger a response.
South Korea led the gains, with the Kospi up 1.7%, as index heavyweight Samsung Electronics announced a record net profit for the second quarter. In contrast to the disappointing Apple results earlier this week, shares in the technology giant climbed 3.5% after the company reported that its mobile devices continued to sell well during the global economic downturn. Analysts are already predicting that there could be another record result in the third quarter.
Japan's Nikkei Average gained 1.3%, as HSBC and Chinese banks all made substantial gains. The Shanghai Composite was just 0.3% higher.
In company news, Toshiba gained 3.7% in Tokyo after a Nikkei report said that strong performance in its infrastructure segment helped push the company's April to June operating profit higher.
Also in Japan, Nissan Motor gained 2.8%, despite reporting a smaller-than-expected first quarter operating profit, as investors bought amid expectations that the company's earnings are expected to bottom in the first half.
In Hong Kong, AIA Group gained 1.9% after the insurer reported above-view results for the first half of the year. Analysts point out that the company has already achieved 68% of its forecast earnings for the financial year, and the company is doing well with its investments despite market volatility.
Write to Daniel Inman at [email protected]