Asia stocks extend gains as investors eye earnings, possible CIT rescue; Hong Kong up 2 pct

Asian markets gain as investors eye earnings, CIT

HONG KONG — Asian stock markets extended their advance Monday, with investors emboldened by U.S. lender CIT Group’s eleventh-hour deal to stave off bankruptcy and optimism about corporate earnings.

Hong Kong and South Korean stocks led the region with gains of nearly 3 percent or more, while oil prices traded above $64 a barrel. Japanese financial markets were closed for a holiday.

Investors seem encouraged as Wall Street futures rose amid news commercial lender CIT was closing in on a deal with bondholders for $3 billion in emergency funding. The New York-based bank has been scrambling to raise $2 billion to $4 billion after the federal government last week refused to bail it out.

The news could add more support to a market already relieved that second-quarter results from major American companies have largely turned out better than expected. Investors are hoping reports this week from American Express, airplane manufacturer Boeing, industrial equipment maker Caterpillar, among others, will provide more evidence that world’s largest economy is stabilizing.

“It’s hard to see a big correction right now,” said Andrew Orchard, Asian strategist for Royal Bank of Scotland in Hong Kong. “Earnings have helped the market rally a bit and there’s still a lot money out there, so I think we could move higher.”

Hong Kong’s Hang Seng jumped 597.40 points, or 3.2 percent, to 19,403.06 and South Korea’s Kospi added 38.41, or 2.7 percent, to 1,478.51.

Most other major markets were also in the green, with India’s Sensex climbing 2.3 percent and Shanghai’s benchmark rising 2.4 percent. Australian, Taiwan and Singapore shares were up 1 percent or more.

Indonesian’s market suffered Asia’s only decline, falling 0.6 percent and adding to losses after Friday’s deadly bomb blasts at two luxury hotels in the capital Jakarta.

Investors will also look this week to Washington for direction when U.S. Federal Reserve Chairman Ben Bernanke makes his semiannual report to Congress Tuesday and Wednesday. A key concern for investors is how the central blank plans to eventually undo extraordinary emergency measures that included cutting interest rates to near zero and buying up government securities as the financial crisis deepened.

Wall Street closed little changed Friday.

The Dow Jones industrials rose 32.12, or 0.4 percent, to 8,743.94, but the broader Standard & Poor’s 500 index slipped 0.36, or less than 0.1 percent, to 940.38.

U.S. futures pointed to a higher open Monday. Dow futures were up 18, or 0.2 percent, at 8,715 and S&P futures gained 0.4 point to 937.30.

Crude prices bounced in Asian trade, the benchmark contract rising 75 cents to $64.31 a barrel. The contract advanced $1.54 in Friday trade.

The dollar was higher at 94.62 yen from 94.32 yen. The euro strengthened to $1.4186 from $1.4115.