A man checks stock prices on the electronic stock board of a securities firm as others walk by in Tokyo Tuesday, Sept. 11, 2012. Asian stock markets retreated Tuesday as investors sought safety ahead of critical events this week that will test Europe's willingness to unite in order to deal with a major debt crisis. (AP Photo/Koji Sasahara)
A man checks stock prices on the electronic stock board of a securities firm as others walk by in Tokyo Tuesday, Sept. 11, 2012. Asian stock markets retreated Tuesday as investors sought safety ahead of critical events this week that will test Europe's willingness to unite in order to deal with a major debt crisis. (AP Photo/Koji Sasahara)
A man walks by an electronic stock board of a securities firm showing Japan's Nikkei 225 index that dropped 61.99 points to close at 8,807.38 for the day in Tokyo Tuesday, Sept. 11, 2012. Asian stock markets retreated Tuesday as investors sought safety ahead of critical events this week that will test Europe's willingness to unite in order to deal with a major debt crisis. (AP Photo/Koji Sasahara)
Investors look at the stock price monitor at a private securities company Tuesday, Sept. 11, 2012, in Shanghai, China. Asian stock markets retreated Tuesday as investors sought safety ahead of critical events this week that will test Europe's willingness to unite in order to deal with a major debt crisis. (AP Photo)
BANGKOK (AP) ? Asian stock markets rose Wednesday on confidence a German court will back the country's participation in a bailout fund created to prevent the weakest euro economies from going bust.
Expectations that the court will reject the challenge to the German government's approval of the fund, known as the European Stability Mechanism, offset concerns generated by a warning from Moody's Investors Service that it may cut its credit rating for the United States.
The Moody's warning that it may downgrade its triple A score for the U.S. by one notch if progress isn't made next year on reducing the country's debt-to-GDP ratio had been widely-anticipated. Last year, the U.S. lost its top rating from the Standard & Poor's ratings agency. That caused markets to plunge.
"No one expects the German Constitutional Court to stand in the way of approving the European Stability Mechanism and Fiscal Compact today," said analysts at DBS Bank Ltd. in Singapore.
Japan's Nikkei 225 index rose 1.6 percent to 8,946.11. Hong Kong's Hang Seng added 0.8 percent to 20,025.66 and South Korea's Kospi gained 1.6 percent to 1,951.54.
Investors will also be keeping a close watch on developments in Athens as the Greek government meets its international debt inspectors. Greece has to convince them that it is abiding by the terms of its bailout agreement so it can get its next installment of rescue money needed to avoid a chaotic default on its debt.
Also Wednesday, Federal Reserve officials will gather for a two-day meeting. Many expect the Federal Open Market Committee to Thursday afternoon announce a third round of bond purchases to revive the sluggish economy. Such action, known as quantitative easing or QE, serves to stimulate the economy by causing interest rates to fall.
"A lot of optimism is being priced into the market in that the U.S. may be doing another round of QE very soon. It has been put off for a long time," said Lee Kok Joo, head of research at Phillip Securities in Hong Kong. Stock markets for the moment were ignoring the downgrade threat from Moody's.
Among individual stocks, Japanese telecommunications equipment maker Oki Electric Industry plunged 11 percent after forecasting a bigger-than-estimated loss in connection with improper accounting at its Spanish unit, Kyodo News Agency said.
Hong Kong-listed China Eastern Airlines gained nearly 3.5 percent after announcing it is raising $572 million by selling new shares to its state-owned parent to trim its heavy debt burden as it pursues an aggressive fleet expansion in China.
On Wall Street, the Dow Jones industrial average rose 0.5 percent to close at 13,323.36 on Tuesday. The Standard & Poor's 500 index rose 0.3 percent to 1,433.56. The Nasdaq composite index increased less than one point to 3,104.53.
Benchmark crude for October delivery was steady at $97.17 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 63 cents to finish at $97.17 on the Nymex on Tuesday.
In currency trading, the euro rose to $1.2858 from $1.2871 late Tuesday in New York. The dollar rose to 77.84 yen from 77.78 yen.
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