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Shares in Asia edge higher as Greece vote calms euro zone fears

Published 07/16/2015, 12:09 AM
Updated 07/16/2015, 12:11 AM
© Reuters.  Asian shares edge up on Greece vote
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Investing.com - Asian shares edged higher on Thursday as Greece passed a key austerity bill late on Wednesday in a fiery session of parliament that sets the stage for bailout help and the re-opening of its banking system.

The Nikkei 225 gained 0.47%, while the Shanghai Composite rose 0.99%, the Hang Seng eked out 0.03% and the S&P/ASX 200 climbed 0.29%.

Earlier on Wednesday in Europe, the Greek parliament passed sweeping austerity measures demanded by lenders to open talks on a new multibillion-euro bailout package, with dozens of hardliners in the ruling Syriza party deserted Prime Minister Alexis Tsipras.

The package was approved with 229 votes in the 300-seat chamber. There were 64 votes against it and six abstentions. But Tsipras required the support of pro-European opposition parties to push the measure through, leaving a question over the future of his government, which he said would continue with him as leader.

In New Zealand, second quarter consumer prices rose 0.4% quarter-on-quarter, well below the 0.6% gain seen and the annual clip came in at a gain of 0.3%, below the 0.4% increase expected.

The outcome is in line with Reserve Bank expectations, though since the last monetary-policy statement the exchange rate has fallen on a trade-weighted basis and is now nearly 7% below where the RBNZ forecast for the current quarter. That hasn't affected the latest CPI figures but will flow through into the next quarter. The Reserve Bank will review the official cash rate July 23 and expectations are for a cut of 25 basis points to 3.0%.

MI Australia inflation expectations see consumer prices at a weighted-mean 2.6% in June compared to 2.3% in the previous survey.

The weighted-mean measure includes inflation expectations between zero and 5% and is closer to the RBA band of 2% to 3%. A rise in expectations is surprising, but are near expectations for inflation to remain within the target band.

Overnight, U.S. stocks were lower after the close on Wednesday, as losses in the Oil & Gas, Basic Materials and Telecoms sectors led shares lower.

At the close in New York, the Dow Jones Industrial Average fell 0.02%, while the S&P 500 index declined 0.07%, and the NASDAQ Composite index declined 0.12%.

On Wednesday, Federal Reserve Chair Janet Yellen said the central bank is on track to raise interest rates "before year end."

In prepared remarks released before her testimony to the House Financial Services committee, Fed Chair Yellen said that the Fed is likely to raise rates "at some point this year." She added that the U.S. labor market healthier but "still some slack."

According to Yellen, the Greek debt crisis, as well as China's recent economic woes, "pose some risks" to U.S. growth.

At the same time, data showed that the Empire State Manufacturing Index rose to 3.86 this month from minus 1.98 the previous month, compared to expectations for a reading of 3.00.

A separate report showed that U.S. producer prices rose 0.4% in June, beating expectations for a 0.2% gain. Year-on-year, producer prices fell 0.7% in July, less than the expected 0.9% decline.

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