Asian Shares Rise on Hopes for Greece

Asian stocks rose in early trading after European markets stabilized on Wednesday as investor confidence recovered despite the absence of progress in debt talks between Greece and its creditors.

Greece will hold a referendum Sunday to decide whether to accept creditors' demands—a vote that effectively is over whether the country should stay in the eurozone.

"If it's Armageddon, the markets seem oblivious to it and despite some risk aversion there's hardly any panic," analysts from Socié té Gé né rale wrote in a research report. "Some assets are even gaining ground against the odds."

Japan's Nikkei 225 Stock Average rose 1.3%, while Australia's S&P/ASX 200 index gained 0.7%. South Korea's Kospi Composite was up 0.2%. The euro was flat against the dollar at $1.1044.

China took another step to stabilize its plunging stock markets after a fresh selloff on Wednesday, as the Shanghai and Shenzhen stock exchanges lowered fees on securities transactions, the official Xinhua News Agency reported. Both the Shanghai Composite and the Shenzhen Composite are down more than 20% from recent highs. Hong Kong's market reopens Thursday after a public holiday on Wednesday.

Late Wednesday, the China Securities Regulatory Commission amended rules governing how investors are allowed to borrow to fund their stock purchases. Much of the increase in stock prices has been fueled by so-called margin trading. The CSRC abolished regulations that forced brokers to recall loans of customers whose leverage exceeds maximum levels, allowing brokers instead to negotiate rollovers of loans directly with clients, Xinhua reported.

"The CSRC announcement will bring forward the point at which sufficient leverage has been bled out of the system for the rally to resume," analysts from ING wrote in a research report.

Write to Gregor Stuart Hunter at [e-mail]

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