Asian stocks leap as fears ease over British vote on EU

AP News
Posted: Jun 19, 2016 11:04 PM
Asian stocks leap as fears ease over British vote on EU

HONG KONG (AP) — Most Asian stock markets jumped Monday as polls suggest British voters will choose to remain in the European Union in a referendum this week, easing investor worries about a possible "Brexit."

KEEPING SCORE: Japan's benchmark Nikkei 225 index surged 2.3 percent to 15,953.51 and South Korea's Kospi climbed 1.2 percent to 1,976.85. Hong Kong's Hang Seng added 0.7 percent to 29,305.61 but the Shanghai Composite Index lost 0.6 percent to 2,867.14. Australia's S&P/ASX 200 rose 1 percent 5,216.50. Benchmarks in Taiwan, New Zealand and Southeast Asia also rose.

BREXIT: Global investors are focused on Britain's Thursday referendum on EU membership, with results expected a day later. Market anxiety over the uncertain consequences of a British exit, or a "Brexit," had been rising as support for the "Leave" side strengthened. However, three polls over the weekend showed that the "Remain" side had recovered some of the ground that had been lost, giving investors more confidence to move into riskier assets.

ANALYST INSIGHT: "The entire market is now focused on the UK's EU referendum result," said Margaret Yang, an analyst at CMC Markets in Singapore. "Judging by the market reaction over the last two days, more volatility is likely this week. It is expected that a vote to remain would lead to a quick unwinding of risk premium and a substantial risk-on rally, whereas a Brexit vote would have the opposite effect."

WALL STREET: Major U.S. benchmarks ended lower on Friday. The Dow Jones industrial average lost 0.3 percent to 17,675.16. The Standard & Poor's 500 index fell 0.3 percent to 2,071.22 and the Nasdaq composite fell 0.9 percent to 4,800.34.

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CURRENCIES: The dollar rose to 104.61 yen from 104.13 yen in late trading Friday. The euro strengthened to $1.1359 from $1.1276.

ENERGY: Benchmark U.S. crude oil futures rose 0.9 percent to $48.42 a barrel in electronic trading on the New York Mercantile Exchange. The contract had climbed $1.77 to close at $47.98 a barrel on Friday. Brent crude, used to price international oils, gained 33 cents to $49.50 a barrel in London.