European Markets Are Building Up Further Gains, Asia Closed Mixed

Asian stocks closed with some mild gains on Wednesday by breaking a string of recent losses. Investors took their positive lead that markets may be able to support themselves even in the absence of Fed support in the US due to better than anticipated economic data strength released yesterday. However, pressure remains constant in mainland china where traders are still concerned about the recent spike in interbank money rates. The People Bank of China did confirm today that the country will address these spikes in interbank rates and it will safeguard its money market.

The Nikkei Index was the worst performing index during the session which closed with a loss of -1.04%. The index is still down nearly -10.33% so far this month. The Shanghai index was the second worst performer and closed with a loss of -0.43%. The Hang Seng index on the other hand managed to close with strong gains of 2.43%.

Banking sector came under pressure in Shanghai and shares of Industrial & a commercial Bank of China lost nearly -5.8%. Another banking group called China Minsheng Banking Corp also lost nearly -4%. On the other hand lenders enjoyed some solid gains and shares of ICBC and China Minsheng both surged nearly 4.8% and 5.1% respectively. However, back in Tokyo exporters experienced another down day due to strength in the Yen and shares of Mazda Motors and Hitachi Construction Machinery both lost nearly -1.1% and -2.1% respectively.

European stock markets are building up further gains on top of yesterday, during the early hours of trading. The Bank of England’s Governor Marvin King’s Speech will take most of the focus today which is due later at 09:30 GMT. Investors will focus if the Bank of England will announce another round of quantitative easing to support the economic growth of the country.

The IBEX index is the best performing index during the session and it is up by nearly 1.87%. The FTSE MIB, the FTSE 100, the DAX are all trading higher with a gain of 1.46%, 0.94% and 1.33% respectively.

The Direct line Insurance group announced that it is reducing its cost by nearly 130 billion pounds and shares are trading higher nearly by 3.6%. Banking sector in Spain got an upgrade by Citigroup who raised the sector to neutral. Bankinter SA and Banco Santander both gained nearly 3.2% and 2.1 respectively. Citi group also raised the ratings of these banks from sell to buy and from sell to neutral respectively.