Stocks up on rate cut hopes
Asian stocks hamstrung by U.S. spending worryCREDIT CONCERNS
While equities have been running hot and cold, commodity markets have blazed higher.
"There's been a movement of investment funds from other asset classes to commodities again, and I think gold has benefited from that move," said Darren Heathcote of Investec Australia.
Crude oil hit a peak of $101.32, near its all-time inflation adjusted high of $101.70 hit in April 1980, according to the International Energy Agency.
Gold's rise lifted silver to $17.90 an ounce, its highest since December 1980, and Malaysian palm oil futures also hit a record high.
Asian technology companies led the way up after a strong profit outlook from computer and printer maker Hewlett-Packard Co, which lifted Wall Street indexes by nearly 1 percent.
"HP's forecast-beating profits indicated tech product demand in the U.S. market has not been hit by the subprime crisis as hard as investors had worried," said James Wang, chief investment officer of Capital Securities Investment Trust in Taiwan.
But credit markets highlighted the ongoing risks from the crisis, which has hammered earnings of financial companies, dried up funding for deals and dragged down U.S. house prices.
Indexes of U.S and European corporate bonds widened to record levels above safe-haven government paper on Wednesday, further limiting the availability of credit.
Concerns were that traders were unwinding some of their complex structured credit trades and seeking greater protection on others, further pressuring spreads.
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- 1 Commodities and China hopes lift FTSE in early trade
- 2 Asia stocks plumb two-year low
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- 4 Oil falls below $112 a barrel to 4-month low
- 5 Asia stocks at two-year low
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