Shares rise as confidence mends
TOKYO (Reuters) - Asian share markets rose on Friday, as higher oil and metals prices boosted resource stocks, while the dollar fell as investors, growing slightly more confident, gingerly shifted some funds back into riskier assets.
U.S. crude oil futures pushed on above $70 a barrel on renewed rebel attacks against oil facilities in Nigeria and worries that a glitch at the largest U.S. oil refinery may tighten gasoline stockpiles.
The MSCI index of Asian stocks excluding Japan .MIAPJ0000PUS climbed 1.5 percent to 322.92, although remains below the eight-month highs seen at the start of June, while Japan's Nikkei .N225 was up just 0.2 percent.
Australian shares .AXJO jumped 1.4 percent, lifted by oil producers after crude prices firmed, and by Qantas Airways (QAN.AX) after it cut and deferred orders of Boeing (BA.N) Dreamliner aircraft in a cost-saving move.
"The tone of the market is reasonable, people are prepared to buy on the dips ... but it is also hard to see the market roaring ahead," said David Spry, research manager at FW Holst in Melbourne.
In Japan, Nippon Oil (5001.T) jumped over 4 percent after a newspaper reported that it and other Japanese companies were in the final stage of talks with Iraq to win the development contract for Iraq's huge Nassiriya oilfield.
Suzuki Motor (7269.T) climbed 5.5 percent after a source familiar with the matter said Volkswagen (VOWG.DE) was exploring a potential cooperation deal with Suzuki as a way to boost its expertise in the area of ultra-small cars.
A climb on Wall Street supported Asian share markets.
U.S. stocks rose after encouraging news from retailer Bed Bath & Beyond (BBBY.O) and after Federal Reserve Chairman Ben Bernanke withstood grilling in Congress on whether he had coerced Chief Executive Kenneth Lewis of Bank of America to go forward with plans to buy a flagging Merrill Lynch.
The Dow Jones industrial average .DJI closed up 2.1 percent at 8,472.40, with similar gains on the Standard & Poor's 500 Index .SPX and the Nasdaq Composite Index .IXIC.
MIXED FEELINGS
Many share markets have been in retreat in the past two weeks as investors paused to work out if a rally in place since about March has run out of steam, as economies around the world struggle. Data continues to show a mixed picture.
In Japan, consumer price data showed a record drop on the year in May, with falling demand increasingly blamed as the country's second bout of deflation in less than two years deepens.
And in New Zealand, the economy shrank for the fifth quarter in a row in the three months ended March, marking its longest contraction on record.
But markets are more confident than they were a few months ago and for shares, the U.S. Federal Reserve's statement on Wednesday reinforced expectations that interest rates will remain at a record low for a while. Continued...
