US, Asian markets rise on hopes for US economy

Japan's Nikkei stock average rose 0

Japan's Nikkei stock average rose 0.3 per cent today, hitting a three-month closing high on increasing optimism about the US economy and active foreign buying of blue-chip exporters such as Sony.

The yen's retreat, which at one point saw the dollar bounce above the 100 yen mark, boosted car companies such as Honda Motor Co, which hit a six-month intraday high.

Kawasaki Kisen steamed 9.7 per cent higher after Goldma data is due out later on Friday. Analysts polled by Reuters expect the economy to have shed 650,000 jobs last month after losing 651,000 in February.

Data the previous day showed the number of US workers filing new jobless claims at a 26-year high.

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"It's a market of hope, and the question is whether the jobs data will pour cold water on that," said Tomomi Yamashita, a fund manager at Chibagin Asset Management.

"Given that the Nikkei is still really low compared to where it was a year ago, it's clear that it will be difficult to change this long-term trend."

On April 3 last year, the Nikkei closed at 13,389.90, meaning it has lost 35 per cent since then.

US factory orders rose in February for the first time in seven months, boosting industrial, technology, consumer discretionary and energy stocks on Wall Street yesterday.

Hopes for an improving global economy also grew after leaders of the G20 clinched a $1.1 trillion deal yesterday to combat the worst economic crisis since the Great Depression and said financial rules would be tightened to stop it happening again.

Last night US stocks rallied for a third day as more data pointed to a stabilizing economy and changes to an accounting rule were seen as shoring up the volatile financial sector in the short term.

World leaders at the G20 summit on London also boosted markets when they announced an additional trillion dollars to support the International Monetary Fund and boost flagging trade.

Stocks have surged in recent sessions as data increasingly point to an easing in the deep recession. The Dow is now on track for its best four-week rally since 1933. Both the blue-chip Dow average and the S&P 500 ended yesterday's session at nearly two-month highs.

Industrial, technology, consumer discretionary and energy stocks were the biggest gainers after government data showed US factory orders rose in February for the first time in seven months, adding to positive economic news earlier in the week.

General Electric, which not only has customers around the world and a large finance arm, but also operates businesses closely linked to the economic cycle, rose nearly 6 per cent.

"There's definitely signs that the degree of free fall (in the economy) has declined substantially. We're definitely seeing bounces off the bottom in different areas," said David Kreinces, portfolio manager at ETF Portfolio Management in Newbury Park, California.

Agencies