Asian shares climbed to a six-month high today, as hopes that the global economic downturn is nearing its bottom spur demand for riskier assets while hitting the yen and safe-haven government bonds.
European shares also traded higher, with the pan-European FTSEurofirst 300 index of top shares gaining 1 per cent in early trade.
Economic recovery hopes lifted oil prices by almost $1 per barrel, while Japanese bonds fell, sending the benchmark 10-year yields to a 4-½ month high and the yen slid to their lowest since mid-October against the dollar and the euro.
Riskier and higher-yielding currencies such as the Australian and New Zealand dollars rose, reflecting improved risk appetite.
North Korea's launch of a rocket yesterday had little market impact, given that the action had been expected and is seen having limited economic implications.
Instead, investors saw a silver lining in recent bleak data, and expectations that the global economy may not get any worse are spurring some analysts to call for sustained gains in equity markets over the near-term.
A key US jobs report on Friday showed unemployment soared to 8.5 per cent last month, or a 25-year high, but markets found comfort in the fact that the numbers came in just as expected.
In Europe, the euro zone's dominant service sector contracted sharply again in March, but not as rapidly as in February, a private survey showed on Friday.
“The global market sentiment has changed quite dramatically in the past few days after the US data and the G20 summit,” said Alex Tang, head of research with Core Pacific-Yamaichi International in Hong Kong.
“Also data from China still suggests a solid recovery in the economy,” he said, adding he expected more gains in the Honk Kong index.
The MSCI index of Asia-Pacific stocks outside Japan rose 1.8 per cent as of 6.50am, after earlier touching its highest since October 16th.
That marked a fifth consecutive session of gains and a rise of more than 30 per cent since the gauge hit their 2009 low on March 4th.
Japan's Nikkei average gained 1.2 per cent to a three-month closing high.
Other Asian indexes also rose to multi-month highs, although earlier stronger gains were pared in the afternoon.
Reuters