Asian stocks rise as central banks pledge support

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Asian Stocks Rise as Central Banks Pledge Support

Asian stocks surged on Monday, led by gains in Japan and South Korea, as central banks around the world pledged to support the global economy amid growing concerns over the COVID-19 pandemic.

The Nikkei 225 index in Japan jumped 2.4% to 22,444.44, while the Kospi in South Korea rose 2.1% to 2,134.44. The Shanghai Composite Index in China added 1.3% to 3,344.44.

The gains came after the Bank of Japan, the European Central Bank, and the Federal Reserve of the United States all pledged to support the economy through monetary policy measures.

The Bank of Japan announced a new stimulus package worth 30 trillion yen ($275 billion) to help mitigate the impact of the pandemic on the economy. The European Central Bank also announced a new round of bond purchases to inject liquidity into the financial system.

The Federal Reserve, meanwhile, said it would continue to provide support to the economy through its existing stimulus programs, including its quantitative easing program and its emergency lending facilities.

The moves by the central banks helped to boost investor sentiment, with many market participants hoping that the measures would help to stabilize the global economy and prevent a deeper downturn.

"The central banks are doing everything they can to support the economy, and that's giving investors confidence," said Masahiro Ichikawa, a senior strategist at Sumitomo Mitsui Asset Management in Tokyo.

The gains in Asia were also supported by a rally in oil prices, which rose above $30 a barrel for the first time in several weeks. The price of Brent crude oil, the global benchmark, jumped 4.5% to $30.45 a barrel.

The gains in Asia were not limited to Japan and South Korea, with many other markets also rising. The Hang Seng Index in Hong Kong added 1.4% to 24,444.44, while the S&P/ASX 200 in Australia rose 1.2% to 5,444.44.

The gains in Asia came despite a decline in the number of new COVID-19 cases reported in some countries, which has raised concerns about the potential for a second wave of infections.

The pandemic has had a significant impact on the global economy, with many countries imposing lockdowns and other restrictions to slow the spread of the virus. The economic impact of the pandemic has been severe, with many industries, including tourism and retail, suffering significant losses.

Despite the challenges, many investors remain hopeful that the global economy will recover in the coming months, driven by the support of central banks and the eventual rollout of vaccines.

"The pandemic will eventually be brought under control, and when that happens, the economy will recover," said Ichikawa. "The central banks are doing everything they can to support the economy until then."