11:09 PM
HONG KONG |
HONG KONG (Reuters) - Asian stocks were poised for their best weekly gains in three months as market players hunted for bargains while the euro perked up after the European Central Bank signaled a rate hike as early as next month.
Friday's gains brought stocks to near levels since the Libyan crisis erupted, indicating markets have been largely resilient to oil's 12 percent surge in the past two weeks.
A reasonably strong correlation between Asian equities and oil shows both track the broad growth story except for periods when markets have grown nervous of a price shock and the resulting spillover impact on inflation.
The region is a big importer of oil.
But the pull-back in oil from 2-1/2 year highs following two days of strong gains that sent a key technical indicator to its most overbought level in more than five years for Brent crude alleviated such concerns.
A strong Wall Street close and hopes that U.S. jobs data due later may show strong gains and reinforce expectations of a steady improvement in the world's biggest economy boosted stocks with Tokyo .N225 and Seoul .KS11 leading gains.
But further gains on Wall Street looked difficult with the S&P 500 Index .SPX set to run into strong resistance around the 1,340-60 zone.
The broader MSCI index of Asia-ex Japan stocks .MIAPJ0000PUS rose more than a percent, extending its weekly gains to nearly three percent.
"Substantial gains are expected in morning trade on hopes for good jobs data in the U.S., but the market may trim gains toward the close because investors remain cautious until they actually see the figures," said Shinichiro Matsushita, a market analyst at Daiwa Securities.
The median estimate is for a gain of 185,000 jobs, according to economists polled by Reuters, but market sentiment was leaning toward a number above 200,000, traders said.
Notwithstanding the Libyan crisis, Asian markets have generally underperformed this year as inflows into emerging market funds have slowed sharply due to concerns of inflation and crowded positioning in some of the region's markets.
But the latest oil driven sell-off has cleaned up some of the technical positioning and enhanced the attractiveness of certain markets such as Korea, according to Barclays Capital strategists.
Foreign investors were net buyers for a second straight day in the stock market, the strongest since January.
EURO RISES
Gains in stocks diminished the safe-haven appeal for gold and U.S. Treasuries with two-year debt yields rising by as much as eight basis points to 0.77 percent.
Posts
