Asia stocks firm on talk of Japanese stimulus; Nikkei up 0.70%

Investing.com - Asian stocks traded higher on Tuesday after the minutes from the Bank of Japan’s latest monetary policy meeting revealed board members felt easing measures shouldn’t be ruled out.

Earlier this week, Japan reported its gross domestic product grew less than expected in the second quarter, expanding 0.3% according to preliminary figures, below market forecasts for 0.6% growth and well below the first quarter's rate of 1.3%.

During Asian trading on Tuesday, Hong Kong's Hang Seng Index was up 0.24%, Australia's S&P/ASX200 was up 0.18%, while Japan’s Nikkei 225 Index was up 0.29%.

Markets have long expected that the European Central Bank and the U.S. Federal Reserve will stimulate their respective economies with easing measures, though the Bank of Japan had been viewed as one with a little more room to adopt a wait-and-see attitude longer than its western counterparts.

Soft Japanese growth data coupled with dovish minutes from the Bank of Japan sparked a buying spree in Asian equities bourses.

Easing policies weaken paper currencies with the aim of spurring recovery, sending stocks rising in the process.

Weak trade data out of China coupled with reduced growth forecasts for Europe sparked talk of global central bank intervention as well, which further sent Asian stocks rising.

China reported last week that its trade surplus narrowed unexpectedly in July, dropping to USD25.1 billion from a USD31.7 billion surplus.

Economists were expecting a USD35.1 billion surplus.

Meanwhile in Europe, the European Central Bank on Thursday trimmed its forecast for economic growth to 0.6% in 2013, down from 1% previously.

The ECB also forecast the economy to contract 0.3% this year, slightly worse than its previous forecast for a 0.2% contraction.

In Hong Kong, top gainers included China Resources Power, up 2.38%, China Mobile, up 1.36%, and China Petroluem, up 1.27%.

In Australia, top gainers included Bluescope Steel, up 11.43%, Bathurst Resources, up 10.77%, and Carsales.com, up 10.28%.

European stock futures indicated a higher opening.

France's CAC 40 futures pointed to a gain of 0.21%, while Germany's DAX 30 futures pointed to a gain of 0.20%. Meanwhile in the U.K., FTSE 100 futures indicated a gain of 0.23%.

Dow Jones Industrial Average futures were up 0.13% while the S&P 500 futures were up 0.15%.

Later Tuesday, the eurozone will release data on industrial production as well as preliminary data on second quarter GDP, while Germany and France will unveil individual GDP reports.

Also on Tuesday, the ZEW Centre for Economic Research will publish a report on economic sentiment in Germany and throughout the single currency bloc.

In the U.S., data on retail sales and producer price inflation will publish, followed by data on business inventories
 
 
 
 

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