Beijing (AsiaNews/Agencies) – Asia’s main stock exchanges and banks are celebrating after the US government announced it was taking over troubled mortgage giants Freddie Mac and Fannie Mae who own or guarantee half of all US mortgages and had a combined loss of about $14 billion over the past year. The one exception is the Shanghai bourse, which has been in a free fall for weeks now.
When US president George Bush said his government was taking over the two troubled mortgage giants for a total cost of US$ 200 billion, Tokyo’s Nikkei average jumped 3.4 per cent on Monday, the biggest gain in five months. Japan's largest banks rose more than 10 per cent. similarly the MSCI index of Asia-Pacific stocks outside Japan surged 5.1 per cent and Taiwan’s exchange gained 5.5 per cent.
Hong Kong rose as well (shares rose 3.9 per cent) but Shanghai lost another 2.68 per cent today after losing throughout last week (-3.29 per cent on Friday alone), a sign of a structural crisis in the mainland economy, heavily impacted by the credit crisis in the United States where the most recent figures show that about 9 per cent of US homeowners were behind on their payments or faced repossession.
Banks’ reactions were also good. “This is a positive,” Chinese central bank Governor Zhou Xiaochuan said in Basel, Switzerland today, since “Chinese investors have a certain amount of exposure”' to the companies.
The Bank of China rose 5.2 per cent on the Hong Kong exchange; the China Construction Bank jumped 4.3 per cent; the Industrial & Commercial Bank of China was up 4.7 per cent.
Mainland banks own billions of dollars in bonds issued by the two US giants.
Many experts remain cautious however. “The bleeding on the US front has been stemmed, but it does not mean the overall [global] economy will turn upward,” said Masanobu Takahashi, chief strategist at Ichiyoshi Securities.
Banking shares, he noted, are still down 20 per cent in Japan and 30 per cent elsewhere in the region so far this year compared to last.
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