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Japan’s Nikkei’s 225 index has closed 1.2% higher today, up 414 points at 35,089, while the broader Topix index has gained 2.2%.
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Elsewhere, South Korea’s Kospi index is up 2.15%, Hong Kong’s Hang Seng has gained 1.37% so far today.
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Australia’s S&P/ASX 200 is up a modest 0.25%.
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Kyle Rodda, senior financial market analyst at capital.com, explains that the prospect of more stable markets in Japan has boosted equity prices broadly.
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Rodda says:
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The Bank of Japan has effectively blinked.
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The turmoil in Japanese markets has shaken the central bank’s confidence that it can tighten much further without damaging not only its own markets and economy but also the rest of the world’s.
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BOJ Deputy Governor Uchida said the central bank wouldn’t cut rates in times of market instability, all but boxing itself into a corner where any bias towards hiking interest rates would be self limiting by the subsequent volatility that would likely ignite.
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The Japanese Yen dropped on the comments, adding fuel to the Nikkei’s recovery and supporting risk appetite across the globe.
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UK regulator Ofwat has declared it intends to appoint an independent monitor for troubled supplier Thames Water.
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This monitor will supervise the company’s turnaround plan and report back to the regulator on Thames’ progress.
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The monitor would have access to the company’s financial information, and the appointment comes after Thames Water’s credit rating was downgraded twice by ratings agencies Moody’s and S&P in July – which meant the company had breached its licence.
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David Black, chief executive of Ofwat, said:
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“We are clear that Thames Water needs to remedy its licence breach, turnaround its operational performance and secure backing from investors to restore its loss of investment grade credit rating.
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These enforceable commitments will include our putting an independent Monitor into the business, to report back to us on what is happening to drive meaningful change in performance, and to ensure appropriate expertise is added to their Board.
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We will continue to monitor progress very closely and will not hesitate to take any further action if…
Read More: UK house prices jump in July; markets recover as Japan calms rate rise fears –