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Asian Markets Rally Following Wall Street Gains - 2003-03-14


In ending a week in which several Asian markets hit lows not seen in years, shares across Asia rallied. The gains follow buying on Wall Street and a drop in oil prices. A day after the Dow Jones Industrial Average ended 3.5 percent higher, investors moved quickly to buy shares in Asian markets on Friday.

A drop in oil prices was behind the buying, according to analysts who say cheaper oil makes Asian stocks attractive because it boosts economic growth in the region. In addition, lower prices often increase consumer demand for Asian imports in the United States.

Taipei's main share index ended at 4,476, up 2.8 percent from a week ago. One analyst says investors snapped up electronics and computer chip makers on hopes of export-driven economic recovery.

But Neal Stovicek, an analyst with SinoPec Securities in Taiwan, said gains may be short-lived. "This may not be a long-lived rally. In fact, one thought is that the Taiwan market and some global equity markets might pull back depending upon geopolitical conditions and reconfirm some of the lows we saw in October of 2002," he said. "Divorcing ourselves from the geopolitical situation, the semi-conductor industry in Taiwan is showing clear signs of bottoming out."

Tokyo's Nikkei 225 saw its biggest gains in two weeks, rising from 20 year lows to close at 8,002 points. Despite gaining 1.7 percent, the index was still down by the same amount on the week.

In Seoul, the Kospi ended an eight-day slide with a gain of more than two percent. While the rally managed to erase some of the week's losses, the Kospi still ended more that 1.5 percent lower on the week at 537.

Investors this week dumped shares of South Korean conglomerates after investigators unearthed an accounting scandal involving SK Corporation, one of the biggest South Korean companies.

Hong Kong's benchmark Hang Seng index saw its biggest single day gain in more than two months, after hitting lows not seen since the Asian financial crisis. It won back all of the week's losses by closing at 8,956, ending one percent higher than last Friday's finish.