Asian stocks rose, extending the longest run of weekly gains since 2005, and the dollar weakened after China’s central bank cut reserve requirements for banks. Oil advanced as Iran halted crude exports to French and British companies.
The MSCI Asia Pacific Index (MXAP) added 0.9 percent as of 9:33 a.m. in Tokyo. Standard & Poor’s 500 Index futures climbed 0.6 percent. The dollar lost 0.6 percent to $1.3213 per euro. The yen declined against all 16 major peers after Japan posted the largest monthly trade deficit on record. Oil gained 1.5 percent to $104.82 a barrel.
The People’s Bank of China said it will reduce the proportion of cash that lenders must set aside by half a percentage point from Feb. 24, the central bank said in a Feb. 18 statement. Japan’s trade deficit widened to 1.48 trillion yen ($19 billion) as the yen’s strength and weaker global demand eroded manufacturers’ profits.
The reserve-ratio cut “is a bold move and one aimed at maintaining growth rates, which will provide support for equity investors, particularly those who want to take a bit more risk in the current environment,” said Tim Schroeders, who helps manage $1 billion in equities at Pengana Capital Ltd. in Melbourne.
Asian Stocks
Asian stocks have rallied for the past nine weeks, pushing the MSCI Asia-Pacific gauge to a 13 percent advance this year. Raw-material producers and industrial shares led gains today among the 10 industries in the equity benchmark. Oversea-Chinese Banking Corp. (OCBC) shares may be active after Southeast Asia’s second-largest bank reported higher-than-estimated profit.
Brent oil for April settlement increased 1 percent to $120.80 on the London-based ICE Futures Europe exchange. Iran “will give its crude oil to new customers instead of French and U.K. companies,” said Alireza Nikzad Rahbar, a spokesman for the oil ministry.
The euro rose for a third day against the U.S. currency. European finance ministers are meeting in Brussels today to settle remaining disputes as they close in on a 130 billion-euro ($170 billion) Greek bailout.
Hong Kong Exchanges & Clearing Ltd. will begin offering futures tracking the HSI Volatility Index (VHSI) of options prices today. Futures on the benchmark, which tracks expected volatility for the Hang Seng Index over the next 30 days, are the first of their kind based on an Asian market, according to Calvin Tai, head of trading at the Hong Kong exchange.
