Asian stocks rallied, following strong gains in Western markets on Wednesday. The Nikkei advanced 1.8% to 8669, the Kospi rose 1.4% and the ASX 200 closed up 1.7%. Hong Kong’s Hang Seng rose .7%, while China’s Shanghai Composite charted its own course, easing .2%
In Europe, stocks continued to climb, following news that the ECB along with central banks from the US, Japan, and Switzerland would increase liquidity to European banks, to improve the health of the banking sector. The battered banking sector jumped 4.1%, although UBS shares plunged more than 10% after announcing a $2 billion loss by a rogue trader. The CAC40 rallied 3.3%, the DAX advanced 3.2% and the FTSE rose 2.1%.
US markets rallied for a 4th day, with the Dow closing up 186 points to 11433. The S&P 500 gained 1.7% and the Nasdq rose 1.3%. The VIX dropped down to 31 after climbing past 40 earlier in the week.
Currencies
The Euro surged 1.1% to 1.3891 following news of the coordinated central bank effort. The Australian Dollar and Canadian Dollar both gained .7%, and the Swiss Franc jumped .8% to .8692.
Economic Outlook
Thursday’s economic data was mostly negative. Weekly jobless claims rose by 11K last week, 18K more than expected by analysts. The Empire State manufacturing index fell to -8.82, worse than feared, indicating economic contraction for a 4th straight month. CPI data showed a rise in prices of of .4% in August. On the positive side, the Philly Fed Survey said business conditions improved over the last month, although the figure was lower than analyst forecasts.