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Summary Asian stock markets rose Monday as investors cheered a new European fiscal pact.
Asian stock markets rose as investors cheered a new European fiscal pact aimed at fixing the regions debt crisis and preventing a break-up of the euro currency bloc.Benchmark oil hovered above $99 per barrel while the dollar rose against the euro and the yen.Japans Nikkei 225 index jumped 1.5 percent to 8,666.82. South Koreas Kospi added 1 percent to 1,893.63 and Hong Kongs Hang Seng gained 1.3 percent to 18,825.07. Benchmarks in Singapore, Taiwan and Indonesia rose while mainland China fell.Under the deal reached Friday in Brussels, all 17 countries that use the euro agreed to allow a central European authority to oversee their future budgets. They also agreed to automatic penalties if they spend too much.In addition to tighter controls on spending, Europes new fiscal compact calls for the launch of a permanent bailout fund for euro nations in 2012, a year ahead of schedule. The deal also will send 200 billion euros ($267 billion) to the International Monetary Fund, which controls another emergency fund for countries in crisis.But the deal wont help cut debt today, which in Italy, Greece and Spain has driven government borrowing costs close to levels considered unsustainable. That loose end brought into focus the future monetary policy of the European Central Bank, and whether it would be willing to buy enough national bonds from troubled countries to keep interest rates down.Analysts at Credit Agricole CIB said the lack of ECB action in terms of stepping up to the plate as lender of the last resort still weighed on investment sentiment.There were also doubts about the willingness of each individual country to ratify the agreement.In Tokyo, Toyota Motor Corp., Japans biggest car maker, posted a muted gain of 0.5 percent after sharply downgrading its earnings forecast for the fiscal year due to a a strong yen and massive flooding in Thailand that disrupted production.Camera and medical equipment maker Olympus Corp. surged 5 percent amid rising investor faith in the embattled company.Olympus recently admitted falsifying accounting records to cover up huge investment losses from the 1990s and has vowed to investigate about 70 people, including current board members, for their possible involvement.In Australia, energy shares led the gains. Woodside Petroleum rose 1.3 percent. Coal and iron ore miner Aquila Resources rose 3.4 percent and Linc Energy gained 2.9 percent. Mining giant BHP Billiton rose 2.2 percent.Benchmark oil for January delivery was down 7 cents to $99.34 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.07 to finish at $99.41 per barrel on the Nymex on Friday.In currencies, the euro fell to $1.3346 from $1.3370 late Friday in New York. The dollar rose to 77.64 yen from 77.54 yen.
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