Asian shares came close to their highs for the year on Wednesday after surprisingly upbeat Chinese trade data offered hope the Asian giant was finally stabilising, underpinning both risk sentiment and commodity prices.
China reported exports jumped 11.5 percent in March compared to a year earlier, the first increase since June and well above market forecasts. That was a huge improvement on February, even though data at this time of year tends to be distorted by the Lunar New Year holidays. ECONCN
Investor reaction took the improvement on trust and pushed up China-sensitive assets such as the Australian dollar AUD=D4 which briefly climbed atop 77 U.S. cents.
“The latest data certainly suggests that activity levels are lifting and no doubt will give investors a degree of optimism, particularly in light of the recent surge in commodity prices,” said Savanth Sebastian, an economist at Australian fund manager CommSec.
Shanghai stocks .SSEC sped ahead by 2.2 percent, while Japan’s Nikkei .N225 rose 2.8 percent for its biggest daily gain in six weeks.
MSCI’s broadest index of Asia-Pacific shares outside Japan added 1.6 percent and came within a whisker of breaching its high point for the year so far.
Financial spreadbetters at IG expected opening gains of between 0.6 and 0.8 percent for the FTSE 100 .FTSE, DAX .GDAXI and CAC .FCHI.
Oil prices ran into profit-taking in Asia but still held much of the overnight gains made on reports Russia and Saudi Arabia may have reached agreement on an oil output cap. [O/R]
However, Saudi oil minister Ali al-Naimi ruled out a crude output cut in comments made to Saudi-owned al-Hayat newspaper published on Wednesday.
Brent crude LCOc1 eased 52 cents to $44.16 barrel, after rising 4 percent on Tuesday. U.S. crude CLc1 lost 57 cents to $41.60, easing back from a four-month top.
Analysts at Citi noted U.S. crude finished above its 200-day moving average since its long downtrend first started in 2014. “It suggests that the low is in and higher levels should continue to be seen in 2016,” wrote Citi.
WALL ST UP, YEN DOWN
A rally in energy stocks helped the Dow .DJI end Tuesday 0.94 percent firmer, while the S&P 500 .SPX gained 0.97 percent and the Nasdaq .IXIC 0.8 percent. The S&P 500 energy sector .SPNY jumped 2.8 percent.
All 10 S&P sectors closed higher and the Dow industrials posted their best day in about a month.
The lift in energy boosted the oil-sensitive Canadian dollar to near a nine-month peak while nudging the safe-haven yen back from recent highs.
Canada’s loonie stood at C$1.2765 per USD CAD=D4, not far from the overnight top of C$1.2750 – a level last seen in July.
The greenback was up at 108.91 yen JPY=, having climbed from a near 18-month trough around 107.63 set on Monday. The euro rose to 123.80 yen EURJPY=R, putting further distance from a three-year low of 122.08 set last month.
Against the dollar, the euro eased to $1.1357 EUR= after turning around from a six-month peak of $1.1465. That helped the dollar index .DXY climb back above 94.258, from a near eight-month low of 93.627.
In other commodity markets, copper and iron ore sat on large gains while gold XAU= drifted off to $1,248.40 an ounce, having climbed to a three-week high of $1,262.60 on Tuesday.