(RTTNews) - Stock markets across the Asia-Pacific region are trading firm on Friday with the overnight rally on Wall Street significantly buoying up sentiment. The sharp upward revision in economic growth forecast by the Australian central bank and better-than-expected employment and productivity reports from U.S. appear to have erased some concerns about the pace of global economic recovery.

Most of the markets in the region are trading with fairly sharp gains right since trading commenced on Friday. There appears to be some resistance at higher levels in some markets, but that has not resulted in any significant sell-off as such.

The Australian market is trading firm, aided by notable gains posted by bank, materials, energy and industrials stocks.
The benchmark S&P/ASX 200 index is up 63.2 points, or 1.7%, at 3,757.5. The broader All Ordinaries index trading at 4,595, up 75.8 points, or 1.7%, over its previous close.

The Reserve Bank of Australia, releasing its quarterly economic statement, sounded optimistic about Australia's recovery path, saying growth in business investment and exports is expected to be strong, underpinned by an ongoing expansion in the resources sector and a bounce back in Asian economies, particularly China.
While ramping up its forecasts for economic growth out to the end of 2010, the central bank has hinted that more interest rate increases are on the way after two hikes in the past four weeks. The RBA has forecast gross domestic product to expand by 1.75% in year average terms by the end of calendar 2009, compared to its previous forecast in August for growth of 0.5%. Growth will then rise to 2.25% over the year to the end of June 2010, and to 3.25% by the end of the year. Previously it was looking for growth of 1% and 2.25% respectively.

The central bank feels inflation is likely to moderate over the year ahead as the lagged effects of the recent economic slowdown and the appreciation of the Australian dollar exchange rate, which has made imported goods cheaper, works through the economy.

Among key bank stocks, Westpac Banking Corporation is trading stronger by about 2.7%, Commonwealth Bank of Australia and National Australia Bank are up 2% and 1.7% respectively, while ANZ Bank is trading with a modest gain. Diversified financials stock Macquarie Group is up nearly 3.5%.

Among materials stocks, BHP Billiton is up 1.7% and Rio Tinto is gaining 2.3%. Incitec Pivot is up nearly 5%. Orica, Bluescope Steel and Fortescue Metals are also trading notably higher. However, Newcrest Mining is down in negative territory with a modest loss.

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