Asian shares rose on Tuesday on hopes that eurozone officials will act to corral Greece’s debt woes and prevent another full-blown banking crisis, but the euro failed to hold on to all its gains.

After three sessions of wild swings on commodities markets, oil and copper rose, but gold fell further to stand about $300 below the record of more than $1,920 an ounce it scaled in early September.

Turbulence on global markets since late July has been driven by investors’ twin fears of renewed recession in the United States, and the chaos that Europe’s sovereign debt crisis could inflict on the financial system if it continues unchecked.

European Central Bank policymakers said on Monday that officials were working to increase the firepower of the region’s rescue fund in their latest effort to staunch a crisis that US President Barack Obama said was “scaring the world”.

US markets reacted positively, finishing more than 2% higher on Monday, and the mood continued in Asia, where Tokyo’s Nikkei rose 1.6%, coming off its lowest close in more than two years.

MSCI’s broadest index of Asia Pacific shares outside Japan rose 1.5%, after plumbing its lowest levels in 16 months on Monday.

Whilst senior ECB officials confirmed the 440 billion euro rescue fund would likely be increased in size, there were also hints from policymakers that the central bank could cut interest rates next month, reversing a hike earlier this year in a move already expected by markets. For more visit: Business Standard

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