Broadgate: Market News 25/4
25 April 2012
Political instability in Europe deepened concern governments will struggle to contain the region’s debt crisis. The Spanish government said on March 2nd that it would miss its 2012 budget deficit target, and Italy said last week it would fail to reach its goal after lowering growth forecasts. In the Netherlands, Prime Minister Mark Rutte tendered his cabinet’s resignation this week after failing to garner support for proposed spending cuts.
Asian stocks rose, with the regional benchmark index headed for its first advance in five days. The advance in Asian exports comes about after a report showed that the U.S. housing market is stabilizing, with house prices in 20 cities dropping at a slower pace in the 12 months ended February and stronger-than-expected sales of new homes in March. This housing data adds to signs that the world’s biggest economy is improving.
“In addition to a weakening yen, a recovery trend on earnings is being seen both in Japan and the U.S. at the moment, boosting markets,” said Hiroichi Nishi, an equities manager in Tokyo. The yen depreciated to as low as 81.39 against the dollar, and against the euro, Japan’s currency weakened to 107.40. A weaker yen boosts the value of overseas income at Japanese companies when repatriated.
Technology companies posted the biggest advance among the 10 industry groups in MSCI Asia Pacific Index. Apple suppliers gained after results from the Cupertino, California-based company reflected robust demand for iPhones in China and sales of the new iPad. Net income in the fiscal second quarter climbed 94 percent to $11.6 billion, or $12.30 a share, as sales rose 59 percent to $39.2 billion, Apple said in a statement.
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