Asian stocks rise sharply after Europe crisis boost


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The Independent Online

Asian stocks have risen sharply after Japan's economy grew for the first time in four quarters and Europe moved closer to resolving a debt crisis that threatens to hurl the region into recession.

Benchmark oil rose above 99 dollars per barrel while the dollar gained against the euro and held steady against the yen.

The Nikkei 225 index in Tokyo added 1.2% to 8,619.96. Hong Kong's Hang Seng surged 2.4% to 19,600.09 and South Korea's Kospi added 2.2% to 1,903.99.

Benchmarks in Singapore, Australia, and mainland China were also higher.

Hopeful signs emerged over the weekend from Italy after premier Silvio Berlusconi reluctantly bowed to market pressure and resigned. His successor, the economist Mario Monti, faces the monumental task of enacting profound reforms aimed at preventing Italy from defaulting on its 1.9 trillion euro (£1.6 trillion) debts.

"There is a silver lining from the past two weeks of political uncertainties in Greece and Italy," analysts at DBS Bank in Singapore said.

"Both countries now have leaders who are not only closer to the European Union, but are also moving towards forming technocratic governments better suited to implement much needed reforms."

Investment confidence was also boosted after Japan released data showing its economy - badly damaged by a record earthquake in March - had surged in the latest quarter.

The economy surged 6% in the latest quarter, the first expansion for the world's third biggest economy in four quarters. It comes as Japan claws its way out of a crisis stemming from an earthquake and tsunami that decimated factories across the country's north-east on March 11.

Since then, the country has steadily restored its factories, helping the economy rebound despite the threats of a financial crisis in Europe, slowing global economy and a strong yen.