SYDNEY, NSW, Australia-based stocks in Asia made broad gains despite a sudden surge in the U.S. dollar, which put pressure on the British pound, interrupting its recovery rally.
Overnight, the Bank of England began a bond-buying program to underpin Gilts and the UK currency. The value of the Gilts went up sharply, pushing yields lower, but the currency came under pressure again.
Finn Robinson, an ANZ economist, told Reuters that it was a mess.
How long will the calm and fresh optimism last? This re-stimulation will lift, not quell UK inflation, and that's bad for bonds and sterling. DBS' rates strategist Eugene Leow in Singapore concurred. Leow told Reuters that nothing has changed fundamentally other than a circuit breaker provided by BOE.
In Japan, the Nikkei 225 rose 248.07 points, or 0.95 percent, to 26,422. The Australian All Ordinaries increased by 100.80 points or 1.51 percent to 6,760. In New Zealand, the S&P NZX 50 gained 80.47 points or 0.72 percent to 11,200. The Hang Seng was still trading in Hong Kong at the time of writing. The index was down more than 100 points against the trend.
The pound fell to 1.0789 at the Sydney close on Thursday after the U.S. dollar gained ground in the Asian trading zone. The euro fell to 0.9662. The Japanese yen was little changed at 144.74. The Swiss franc was lower to 0.9840.
The Australian dollar was very low at 0.6457. The New Zealand dollar fell to 0.5664.
Overnight on Wall Street, the Nasdaq Composite surged 222.13 points or 2.05 percent to 11,051. The Dow Jones industrials went up 548.75 points or 1.88 percent to 29,683. The Standard and Poor's 500 added 71.75 points or 1.97 percent to 3,719.