World stocks up a day after Dow hits record high

World stock markets higher 1 day after Dow breaks all-time high

Associated Press
Markets keep rising after Dow hits record high

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An investor looks at the stock bulletin board at a private securities company on Wednesday, March 6, 2013. The Dow's new all-time high and better economic data from the United States propelled Asian stock markets higher Wednesday. (AP Photo/Eugene Hoshiko)

BANGKOK (AP) -- The Dow's new all-time high and better economic data from the United States propelled world stock markets higher Wednesday.

Markets continued to shrug off a budget impasse in Washington. Automatic government budget cuts took effect Friday after President Barack Obama and Congress failed to reach a budget deal. Economists expect the $85 billion in cuts to hurt U.S. economic growth.

European shares added to gains reaped a day earlier, when the Dow posted a new record. Britain's FTSE 100 rose 0.2 percent to 6,446.43. Germany's DAX advanced 0.4 percent to 7,903.70. France's CAC-40 added 0.3 percent to 3,798.04.

Wall Street showed no signs of slowing, with Dow Jones industrial futures rising 0.3 percent to 14,272. S&P 500 futures gained 0.3 percent to 1,541.80.

Japan's benchmark index reached a multi-year closing high, capping a day of positive trade in Asia. The Nikkei 225 jumped 2.1 percent to close at 11,932.27, the highest finish since September 2008.

Hong Kong's Hang Seng added 1 percent to 22,777.84. South Korea's Kospi rose 0.2 percent to 2,020.74. Australia's S&P/ASX 200 advanced 0.8 percent to 5,116.80. Benchmarks in Singapore, Taiwan, Indonesia and mainland China rose.

Analysts said markets were taking their cues from Federal Reserve chairman Ben Bernanke, who has overseen a campaign of massive bond-buying to support the world's biggest economy after the 2008 financial crisis. The issuance of bonds has pushed their prices down, steering investors toward stocks. The program known as "quantitative easing" is in its third phase, which is dubbed QE3.

"The lesson is clear. Don't bet on Capitol Hill. Bet on Fed Chairman Ben Bernanke instead. To be sure, it was Bernanke's reassurance, as last week's congressional testimonies on monetary policy, to keep QE3 on its present course that turned a worried stock market into a record high," said analysts at DBS Bank Ltd. in Singapore.

Ric Spooner, chief market analyst at CMC Markets in Sydney, said the new highs reached on Wall Street provided a psychological boost to investors but that such gains can go into reverse pretty quickly.

"From the big picture point of view, there is a lot of risk in either direction for the stock market at the moment," he said. "But we could quite easily continue rising, given how low interest rates are."

Among individual stocks, troubled Japanese electronics maker Sharp Corp. soared 14.1 percent after South Korea's Samsung Electronics Co. said it will invest 10.4 billion yen ($112 million) in Sharp to secure a supply of large-size LCD panels. Samsung gained 0.7 percent.

Benchmark oil for April delivery was up 7 cents to $90.88 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 70 cents to close at $90.82 a barrel on the Nymex on Tuesday, hours after the death of Venezuelan President Hugo Chavez, whose country sits on the world's second-largest oil reserves, after Saudi Arabia.

In currencies, the euro rose to $1.3050 from $1.3040 late Tuesday in New York. The dollar rose to 93.42 yen from 93.29 yen.


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