Asia petrochemical shares, crude prices surge on eurozone hopes

29 June 2012 07:15  [Source: ICIS news]

German Chancellor Angela Merkel and Italian Prime Minister Mario Monti meeting on 22 JuneSINGAPORE (ICIS)--Shares of petrochemical companies in Asia were higher at midday on Friday, in line with rallies in regional bourses and crude futures, as European leaders agreed on a plan to tackle the eurozone crisis.

The plan calls for a creation of a single supervisory body for eurozone banks by the end of the year.

European leaders who met in Brussels, Belgium, on Thursday also agreed to allow a scheme to recapitalise financial institutions in the region by tapping rescue funds without adding the government debts.

In a statement issued following the summit, the EU said: “We affirm that it is imperative to break the vicious circle between banks and sovereigns.”

Demand for Asian exports has significantly weakened since the eurozone, which is a major market for the region, got caught up in a sovereign debt crisis.

At 06:41 GMT, shares of Japanese petrochemical firms were up, with Mitsui Chemicals rising 1.54%, Mitsubishi Chemical up 2.04% and Asahi Kasei rising 2.13%. The benchmark Nikkei 225 index was up 132.12 points or 1.49% at 9,006.23 points.

In South Korea, Kumho Petrochemical gained 2.14%, Hanwha Chemical was up 0.96% and SK Innovation jumped 4.94%, as the KOSPI composite index gained 26.86 points or 1.48% at 1,846.04.

In Hong Kong, the benchmark Hang Seng index rose 427.54 points or 2.25% at 19,452.81.

In Thailand, PTT Global Chemical edged up 1.36% and Siam Cement rose 0.63% as the SET index was up 9.01 points or 0.77% at 1,180.33.

Crude futures gained more than $1/bbl on Friday, welcoming the news of the eurozone plan. US crude was trading at above $79/bbl, while Brent crude was quoted at around $93/bbl levels.

Earlier doubts about the eurozone leaders‘ ability to tackle the debt problems had weighed down on the equities and commodities markets prior to the Brussels meeting.

By: Pearl Bantillo
+65 6780 4359

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