Major Asian Stock Markets Rally on Wednesday as Concerns of Banking Crisis Ease

(MENAFN) Major Asian stock markets ended Friday with gains as the sentiment recovered due to governmental and institutional aids to avoid a potential banking crisis. This follows the announcement of Zurich-based lender Credit Suisse receiving up to 50 billion Swiss francs (USD54 billion) from the Swiss National Bank on early Thursday, while America's largest lenders announced a USD30 billion lifeline for First Republic Bank, facing a possible cash crunch. These measures have helped to ease concerns of a banking crisis and have boosted the market sentiment.

The risk appetite in the market waned earlier this week due to worries about the spillover effect of the collapse of Silicon Valley Bank and Signature Bank within days. This turmoil in the global banking sector fueled expectations that major central banks would ease policy tightening to stem a recession.

The Asia Dow, which includes blue-chip companies in the region, rose 1.48 percent to 3,267.85, while Tokyo's Nikkei 225 stock exchange gained 1.20 percent to close at 27,333.79. The Hang Seng, the benchmark for blue-chip stocks trading on the Hong Kong stock exchange, enjoyed the largest hike on Friday, diving 1.64 percent to 19,518.59 points. China's Shanghai stock exchange increased 0.73 percent from the previous close to 3,250.55 points.

The People's Bank of China also lowered the reserve requirement ratio for financial institutions by 25 basis points on Thursday, with immediate effect, which may help to stimulate lending and boost economic growth. The Singapore benchmark index rose 0.88 percent to 3,183.28 points, while the Indian Sensex benchmark went up by 0.62 percent to 57,989.90.

Overall, the measures taken by major lenders and central banks have helped to ease concerns of a potential banking crisis and have boosted the sentiment in the Asian stock markets. However, concerns about the global economic outlook and the potential spillover effects of banking sector turmoil may continue to weigh on the market in the coming weeks.


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