OVERSEAS MARKETS

Asian markets gain in wake of Wall Street rally
Markets across Asia experienced a bump Wednesday, with sentiment aided by the confidence displayed by U.S. President Barack Obama in his first address to Congress as president. Japan's Nikkei 225 advanced 2.7%, Taiwan's Taiex gained 1.4% and India's Sensex climbed 1.8%. South Korea's Kospi and China's Shanghai Composite both inched up 0.3%, while Australia's S&P/ASX 200 gave up 0.1%. Hong Kong's Hang Seng rose 1.6%, Thailand's SET index added 0.8% and Singapore's Straits Times Index edged up 0.3%. MarketWatch (25 Feb.)

Irish stock market plummets after raid at Anglo Irish Bank
A raid by fraud investigators at the headquarters of Anglo Irish Bank, which was nationalized last month, sent Ireland's stock market to its lowest in 14 years. The bank is accused of a series of scandals, including a loans-for-shares scheme. About 120,000 people protested during the weekend in Dublin against the government's handling of the financial crisis. The Times (London) (25 Feb.)

Dollar spikes to 3-month high against yen
A race to the safe haven of U.S. currency pushed the dollar to its highest in three months against the Japanese yen Tuesday. Foreign-exchange markets are playing out in a "counterintuitive way," with perceived weakness in the U.S. economy becoming "bullish" for the dollar because it is "the ultimate destination for risk aversion," a currency strategist at Forex.com said. Reuters (24 Feb.)

Asian firms vulnerable to rating downgrades, S&P says
Standard & Poor's reported that companies in Asia, often highly dependent on exports, face their highest risk in five years of having their corporate-debt ratings downgraded. Companies most likely to be downgraded are those in finance, high tech, retail, restaurants, auto manufacturing, forest products, building materials and capital goods, S&P said. Financial Times (25 Feb.)

U.K. debt buyers seem unfazed by talk of rating downgrade
Buyers of U.K. government debt accepted last week the lowest yield ever offered on three-year gilts, the Debt Management Office's CEO said, indicating investors are not concerned about a possible credit-rating downgrade. In all, the British government plans to sell $212 billion in bonds in the year ending March 31, partially responding to declining tax revenue. Bloomberg (24 Feb.)

Germany's crumbling economy spurs jump in spreads on CDS
The Eastern European financial crisis is raising concerns about the stability of the banking system in Germany, forcing the cost of bankruptcy protection on the country's sovereign debt to hit an all-time high. The spike comes after Deutsche Bank warned that the country's economy will likely shrink by 5% this year, and "a bigger contraction can't be ruled out." Telegraph (London) (24 Feb.)

Cash-rich SWFs consider putting more in commodities, oil
Sovereign-wealth funds, which have as much as $4 trillion in assets, could greatly affect financial markets if they go ahead and raise their commodity and oil holdings. "The potential for growth is absolutely massive," said Amrita Sen, an analyst at Barclays Capital. "They are waiting for the right signals. They want to see the economy beginning to bottom and that oil has turned." Many SWFs have been burned during the financial crisis and are considering different strategies, analysts said. ArabianBusiness.com (24 Feb.)

Report: China plans to form "Big 10" automakers
Gearing up for an expansion in automotive manufacturing, China is working toward creating a "Big 10" group of automakers, according to a report by Shanghai Securities News that was posted on the Web site of the China Association of Automobile Manufacturers. The government wants to increase domestic sales and production to 10 million units this year, from 9.38 million last year, then continue growth at about 10% annually for several years, according to the report. The Straits Times (Singapore) (25 Feb.)