Asian Stocks Advance to Five-Month High After Greek Bailout Deal – Bloomberg

(Bloomberg) — Asian stocks rose, with the regional benchmark index heading for its highest close since September, after U.S. equity gauges climbed to records as Greece reached a provisional deal on its bailout program.

The MSCI Asia Pacific Index added 0.1 percent to 145.21 as of 9:01 a.m. in Tokyo. The gauge advanced 1.5 percent last week, while the Standard & Poor's 500 Index and Dow Jones Industrial Average climbed to all-time highs. Euro-area finance ministers reached an agreement intended to keep aid flowing to Greece for four months in return for a commitment to budget targets, buying time to work out the details of longer-term financing.

"There's clearly some momentum for equities," Tim Schroeders, a portfolio manager who helps oversee about $ 1 billion in equities at Pengana Capital Ltd. in Melbourne, said by phone. "When you have bonds yielding next to nothing, equities are a good alternative. Equities still look cheap relative to bonds. Greece has four months to work out a solution. We'll have to wait and see."

After talks in Brussels between officials from the 19 euro members concluded late on Friday, Greece now has until the end of Monday to complete a list of policies in return for the continued funding. European finance chiefs will then decide whether the proposals go far enough or trigger another round of emergency negotiations this week.

The Greek reform measures are still subject to validation by the International Monetary Fund, the European Central Bank and the European Commission, the institutions collectively known as the troika that Prime Minister Alexis Tsipras vowed not to recognize.

Japan's Topix index gained 0.5 percent. The Nikkei 225 Stock Average rose 0.8 percent after last week climbing to the highest close since May 2000. Australia's S&P/ASX 200 Index added 0.2 percent, while New Zealand's NZX 50 Index advanced 0.1 percent. South Korea's Kospi index increased 0.8 percent.

Markets in Hong Kong, Singapore and South Korea reopen today, while those in China and Taiwan are still shut for the Lunar New Year holidays.

Futures on the S&P 500 were little changed today after the U.S. equity benchmark index climbed 0.6 percent Friday. The Nasdaq Composite Index extended its rally to eight days, while the Russell 2000 Index of small companies rose to a record.

Investors will receive further clues on the central bank's assessment of the economy and the timing of a rate increase when Federal Reserve Chair Janet Yellen gives two days of testimony to Congressional finance committees starting Tuesday.

To contact the reporter on this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net

To contact the editors responsible for this story: Sarah McDonald at smcdonald23@bloomberg.net Tom Redmond