Last Update 23:15
Saturday, 16 November 2019

Asia stocks rally with oil, Tokyo hits 10-month high

AFP , Tuesday 22 Nov 2016
Trader Gregory Rowe, left, works on the floor of the New York Stock Exchange, Monday, Nov. 21, 2016. U.S. (AP Photo)
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Views: 1449

Asian markets rose Tuesday with energy stocks tracking a surge in oil prices, while Tokyo hit a fresh 10-month high after an early sell-off prompted by a huge earthquake off the northeast coast.

The quake struck around dawn in the same region as the deadly 2011 tremor, sparking fears of another tragedy. But while it caused some tsunamis they were not as high as five years ago.

The yen strengthened against the dollar after the quake as investors sought out safe-haven assets, but gave up most of the gains as it emerged there was no major damage.

The dollar fell to as low as 110.27 yen before bouncing back to sit at 111.00 yen in the afternoon, with expectations it will extend gains on bets for higher US interest rates under Donald Trump's presidency.

Japan's Nikkei rebounded to end up 0.3 percent at its highest mark since January.

Hopes that the OPEC oil cartel and Russia will be able to hammer out an agreement to cut production have lit a fire under crude prices and in turn energy stocks.

With OPEC's twice-yearly gathering set for November 30, speculation is mounting that officials are close to a deal to tackle a global supply glut.

"Market players are positioning themselves for higher prices, and oil will be in the $50 to $55 range if there is a deal," Giovanni Staunovo, an analyst at UBS Group AG in Zurich, told Bloomberg News.

"OPEC members are building a lot of expectations and taking too much exposure to let a deal fail."

Both main contracts surged more than four percent on Monday and gained nearly one percent in Asian trade, providing a springboard for regional energy firms.

Hong Kong-listed CNOOC soared more than five percent and PetroChina jumped 3.8 percent, while in Tokyo Inpex put on 1.7 percent. Woodside Petroleum advanced 2.4 percent in Sydney.

Hong Kong's Hang Seng Index closed 1.4 percent higher and Shanghai ended up 0.9 percent.

Sydney added 1.2 percent, Seoul 0.9 percent and Singapore 0.6 percent.

Taipei rallied more than one percent while Jakarta, Manila and Kuala Lumpur also gained after recent losses. But traders remain on edge about Trump's plans for global trade, fearing possible huge tariffs to access the US economy.

The uplift tracked a record close on Wall Street for all three main indexes thanks to the energy rally and expectations for a rate rise.

In early European trade London and Paris each rose 0.7 percent and Frankfurt put on 0.6 percent.

Tokyo - Nikkei 225: UP 0.3 percent at 18,162.94 (close)

Hong Kong - Hang Seng: UP 1.4 percent at 22,678.07 (close)

Shanghai - Composite: UP 0.9 percent at 3,248.35 (close)

London - FTSE 100: UP 0.7 percent at 6,827.98

Euro/dollar: DOWN at $1.0615 from $1.0629 Monday

Dollar/yen: UP at 111.00 yen from 110.76 yen

Pound/dollar: UP at $1.2491 from $1.2489

Oil - West Texas Intermediate (new contract): UP 43 cents at $48.67 per barrel

Oil - Brent North Sea: UP 41 cents at $49.31

New York - Dow: UP 0.5 percent at 18,956.69 (close)

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