Asian Stocks Rally to Highest Since Start of 2016 on Oil, China

  • Shanghai and Tokyo shares jump on China data, weaker yen
  • Commodity producers surge as BHP Billiton soars in Sydney

Asian stocks surged, with the regional benchmark headed for its highest close since the first trading day of the year, as trade data added to signs of a pickup in China and a rebound in commodity prices buoyed raw-material producers.

The MSCI Asia Pacific Index rose 1.9 percent to 130.12 as of 5:12 p.m. in Tokyo, a sixth day of gains for the longest winning streak in six months. Japan’s Topix index added 2.6 percent as a weaker yen boosted shares in Tokyo. Gains for industrial metals and a surge in iron ore by the daily limit pushed Australian mining firms higher. Crude yesterday jumped to its highest level since November on prospects Russia and Saudi Arabia have forged a deal on freezing oil output.

“Economic indicators are going in the right direction and there’s more evidence that Chinese stimulus measures are positively impacting the economy,” Shane Oliver, head of investment strategy at Sydney-based AMP Capital Investors Ltd., which oversees about $122 billion, said by phone. “Today we’ve got better export and import figures. So a lot of the fundamental factors that were driving concerns earlier this year seem to have faded.”

The Hang Seng China Enterprises Index of mainland firms listed in Hong Kong surged 4 percent and the Shanghai Composite Index rose 1.4 percent. Hong Kong’s Hang Seng Index advanced 3.2 percent.

China’s exports jumped by the most in a year in March and declines in imports narrowed, adding to evidence of stabilization in the world’s second-biggest economy. The export rebound may suggest its economy fared better than expected in the first quarter, with data due Friday expected to show a 6.7 percent expansion for the period.

Australia’s S&P/ASX 200 Index gained 1.6 percent. BHP Billiton Ltd., the world’s largest mining company, soared 6 percent, the most in two months. Iron ore futures in Dalian, China, jumped for a second day to the highest level in a month. Iron ore has surged as purchases from steel mills in China picked up amid improving profitability in the world’s largest user.

New Zealand’s S&P/NZX 50 Index rose 0.8 percent to a record. Singapore’s Straits Times Index added 2.4 percent and India’s S&P BSE Sensex Index gained 1.8 percent. Markets in South Korea and Thailand are closed Wednesday.

Oil Rally

Energy firms climbed after a surge in oil prices in New York on Tuesday, when crude climbed 4.5 percent to $42.17 a barrel. The commodity rose after Russia’s Interfax news agency reported Saudi Arabia and Russia had reached a consensus on an output freeze, citing an unidentified “informed diplomatic source” in Doha. Kremlin Press Secretary Dmitry Peskov said there’s “hope” for a deal in Doha, regardless of whether Iran joins in.

Russian Energy Minister Alexander Novak spoke to Saudi Petroleum Minister Ali al-Naimi by phone on Tuesday to discuss prospects for an oil production freeze, a person with direct knowledge of the matter said. Saudi Arabia, the biggest OPEC producer, has previously said that it would agree to cap output only if it’s joined by other suppliers including Iran, while Kuwait said a deal can be done without Tehran’s support.

Futures on the Standard & Poor’s 500 Index rose 0.4 percent before JPMorgan Chase & Co., the biggest U.S. bank by assets, reports first-quarter earnings on Wednesday.

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