Asian shares mostly up after German court verdict

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HONG KONG: Asian markets were mostly higher on Thursday as dealers welcomed news that a German court had dismissed an attempt to block the country's contributions to eurozone bailouts, easing debt concerns.

Tokyo added 0.47 percent by the break, Hong Kong was 0.13 percent higher and Seoul climbed 0.56 percent while Shanghai and Sydney were flat.

Germany's Constitutional Court ruled that Berlin was not breaking the law by joining a eurozone bailout mechanism, removing an obstacle to rescues of Greece and other countries.

The country's top court averted a new eurozone crisis by upholding bailouts for debt-wracked nations but insisted parliament have a bigger say in future.

The ruling, nervously anticipated on volatile financial markets, paved the way for Germany -- the European Union's biggest benefactor -- to continue its multi-billion-dollar contributions to bailouts.

"The move might suggest that Germany may participate more actively in peripheral bailouts," said St George Economics in a report to clients, according to Dow Jones Newswires.

Adding to buying sentiment was the US Federal Reserve Beige Book report that provided an improved assessment of the world's number one economy, despite a number of weak indicators, including in manufacturing and jobs.

Asian markets were also given a lift by a strong performance on Wall Street, which bounced back strongly from several days of heavy selling.

The Dow jumped 2.47 percent, the S&P 500 surged 2.86 percent and the tech-heavy Nasdaq Composite rallied 3.04 percent.

Sydney was off its earlier peaks after official data showed the unemployment rate rose for a second straight month in August, to 5.3 percent from 5.1 percent in July.

The dollar fetched 77.30 yen in early Asian trade, slightly higher than 77.26 in New York late Wednesday. The euro was at 108.79 yen, down from 108.89 yen.

The euro edged down to $1.4072 in early Asian trade from $1.4096 in New York late Wednesday but up from the $1.3972 it hit on Tuesday, its lowest level since mid-July.

The European unit was also at 1.2087 Swiss francs, compared with 1.2095.

Oil prices rose as fears over a huge tropical storm in the Gulf of Mexico led to forecasts of a fall in stockpiles due to a shutdown of oil production facilities.

New York's main contract, light sweet crude for October delivery, added 41 cents to $89.75 per barrel.

Brent North Sea crude for delivery in October, gained 18 cents to $115.98.

Gold was trading at $1,836.50 an ounce at 0100 GMT, down from $1,845.60 on Wednesday. (AFP)

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