Asian markets gain amid signs recession easing

BANGKOK — Most major Asian markets advanced Friday with commodity stocks rising amid more signs the world economy is emerging from a deep recession. European shares traded higher.

In the U.S. overnight investors remained emboldened by the Federal Reserve’s more optimistic prognosis of the world’s largest economy, shrugging off weak retail sales figures.

Sentiment in Asia was also underpinned by news that Europe’s biggest economies Germany and France unexpectedly broke free of the recession in the second quarter. Oil prices rose toward $71 on bets that U.S. crude consumption will recover later this year.

Japan’s Nikkei 225 stock average added 80.14 points, or 0.8 percent, to a fresh 10-month high of 10,597.33, and South Korea’s Kospi gained 1.7 percent to 1,591.41. Australia’s benchmark was up 0.6 percent and Singapore’s main index advanced 0.5 percent.

Hong Kong’s Hang Seng recovered losses to close up 32.03, or 0.2 percent, at 20,893.33 while China’s Shanghai index tumbled 3 percent as investors there fretted about the strength of the recovery in Asia’s second-biggest economy.

As trading got underway in Europe, benchmarks in France, Britain and Germany were each about 0.5 percent higher.

Analysts said signs the slump is loosening its grip have given investors more confidence that markets won’t capitulate after posting massive gains since early March.

“The stock markets are always trading ahead of the economy. The stimulus spending in China has meant it is growing faster than other economies and Asian markets have already reflected that,” said Jackson Wong, investment manager at Tanrich Securities in Hong Kong.

Still, markets are now more likely to be in holding pattern until the last quarter of the year rather than significantly adding to the rally, he said. “Chinese officials have been indicating that credit will be tightened in the second half of the year so there is a bit of caution and we are in for a few months of consolidation.”

Optimism about global growth prospects and rising prices for metals like copper lifted commodity stocks. Miner Rio Tinto was up 2 percent in Sydney, commodities trader Noble Group jumped 3 percent in Singapore, and Japanese oil explorer Inpex gained 1.8 percent in Tokyo.

On Wall Street Thursday, the Dow Jones industrial average rose 36.58, or 0.4 percent, to 9,398.19 after rising 120 Wednesday in response to the Fed’s statement that the recession had leveled out. The Standard & Poor’s 500 index rose 6.92, or 0.7 percent, to 1,012.73, while the Nasdaq composite index rose 10.63, or 0.5 percent, to 2,009.35.

U.S. stock futures pointed to a slight fall Friday, with Dow futures off 4 points at 9,384.

Oil prices rose to near $71 in Asia as investors brushed off bad U.S. economic news, betting instead the world’s largest crude consumer will recover later this year.

Benchmark crude for September delivery was up 35 cents to $70.87 a barrel by late afternoon in Singapore in electronic trading on the New York Mercantile Exchange. On Thursday, the contract added 36 cents to settle at $70.52.

In currencies, the dollar fell to 95.14 yen from 95.37 yen. The euro recovered losses to trade almost steady at $1.4280 from $1.4279.