Asian stocks rise on hopes Greece won't default

September 14, 2011 - 11:05 PM

HONG KONG (AP) — Reassuring words from European leaders aimed at calming markets roiled by the continent's sovereign debt fears helped boost Asian markets in early trading Thursday.

German Chancellor Angela Merkel and French President Nicolas Sarkozy pledged in an emergency teleconference on Wednesday night with that they would help Greece avoid a debt default. For his part, Greek Prime Minister George Papandreou affirmed his commitment to debt-reduction targets.

The news soothed markets that have been rattled over the past few days by fears that Greece was heading rapidly toward a chaotic default as well as the idea that it could potentially leave the euro and return to its own currency.

Japan's Nikkei 225 index rose 1.6 percent to 8,653.36 while South Korea's Kospi advanced 1.5 percent to 1,774.72. Hong Kong's Hang Seng rose 0.7 percent to 19,173.08 and Australia's ASX 200 rose 1.4 percent to 4,061.10.

Mainland China's Shanghai Composite Index edged up 0.4 percent to 2,493.01. Benchmarks in Singapore, Taiwan and New Zealand also rose.

"Markets found some relief as the concern over the breakup of the eurozone eased following the Sarkozy, Merkel and Papandreou conference call," strategists at Credit Agricole CIB wrote in a research note.

The news also bolstered markets Wednesday in the U.S., where the Dow Jones industrial average rose 1.3 percent to close at 11,246.73. The Standard & Poor's 500 index rose 1.3 percent to 1,188.68. The Nasdaq composite rose 1.6 percent to 2,572.55.

In currencies, the dollar strengthened to 76.71 yen from 76.65 yen late in New York on Wednesday. The euro fell to $1.3727 from $1.3752.

Benchmark oil for October delivery was down 51 cents $88.40 per barrel in electronic trading on the New York Mercantile Exchange. The contract lost $1.30 to finish Wednesday at $88.91 per barrel.

In London, Brent crude for October delivery was down 27 cents at $109.38 on the ICE Futures exchange.