By Rafael Nam
HONG KONG, April 21 (Reuters) - Asian shares powered to
their highest in more than seven weeks on Monday as financial
firms rallied on hopes that the worst of the credit crisis is
over, and the dollar gained against the Japanese yen.
The U.S. currency was at its highest level to the yen since
early March, with Asian stock and currency markets further
comforted by stronger-than-expected quarterly results from U.S.
firms such as Honeywell <HON.N> and Caterpillar <CAT.N>.
But oil prices hovered near a record $117 a barrel reached
on Friday amid concerns of supply disruptions in Nigeria and
comments by OPEC that it saw no need to increase production.
Gold rebounded after the previous session's sell-off.
"The market is clearly trying to say that the worst of all
these subprime and credit issues are now out, so we can move
on," said Greg Goodsell, equity strategist at ABN AMRO.
"But it remains to be seen whether that is really the case.
It's hard to be conclusive that there aren't further write-offs
out there in the financial sector."
The MSCI measure of Asian stocks beyond Japan
<.MIAP0000PUS> rose 2.3 percent as of 0200 GMT, earlier hitting
its highest level since Feb. 29.
Expectations that the credit crisis is easing have lifted
the MSCI index, which last month hit its lowest since August
2007, when credit concerns first began surfacing.
Forecast-beating earnings from Merrill Lynch <MER.N> and
JPMorgan Chase <JPM.N> last week helped reinforce that
confidence, as did a string of better-than-expected earnings
from U.S. firms, which are seeing overseas sales offset weaker
domestic consumer demand.
Citigroup Inc <C.N> on Friday posted a $5.1 billion
quarterly loss and said it will cut another 9,000 jobs, but its
shares still gained amid expectations that the top U.S. lender
was taking steps to move past its credit problems.
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Also on Friday, diversified U.S. manufacturer Honeywell
International Inc <HON.N> and construction and mining equipment
maker Caterpillar Inc <CAT.N> beat expectations, contributing
to the improving mood in global markets. [] and
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INVESTORS SHUN SAFETY
Tokyo's Nikkei average <> rose 1.7 percent, led by
financials such as Mitsubishi UFJ Financial Group <8306.T> and
exporters such as Honda Motor Co Ltd <7267.T>, which stand to
benefit from a weaker yen.
Shanghai's main stock index <SSEC> rose 4.7 percent, while
stocks in Australia <> and Singapore <.FTSTI> gained over
2 percent. South Korean <.KS> stocks rose 1.6 percent.
The improving confidence also lifted a beleaguered dollar
by 0.2 percent to 103.93 <JPY=>, approaching a seven-week high
of 104.66 hit on electronic trade platform EBS on Friday.
The euro <EUR=> was steady at $1.5815 <EUR=>, having
retreated from a record high of $1.5985 hit on Friday.
Oil prices were little changed at $116.74 a barrel, near
Friday's record $117, after a Nigerian rebel group said on
Friday it had sabotaged a major oil pipeline operated by Royal
Dutch Shell <RDSa.L> and vowed to step up attacks on oil
installations. []
Crude was also supported after the president of the
Organisation of Petroleum Exporting Countries (OPEC) told
reporters during a visit to Kuwait that the group saw no need
to raise oil production to counter high oil prices.
[]
Spot gold traded around $922 an ounce, steadying after
slumping on Friday to a one-week low when investors dumped
safe-have assets.
Asian bonds eased as investors were willing to add riskier
assets such as stocks, with Japanese government bond benchmark
yields hitting seven-week highs. June 10-year futures <2JGBv1>
dipped 0.15 point to 138.45, touching a seven-week low of
138.26.
