Asian shares were trying to string together three sessions of gains on Thursday as upbeat data on U.S. jobs and gains for a range of commodities whetted risk appetites globally.
Notably, oil shrugged off record high U.S. crude stockpiles as investors chose to focus on an OPEC plan to freeze production, keeping alive talk the market had bottomed from a near two-year selloff.
Early Thursday, U.S. crude was up 3 cents at $34.68 a barrel, after Brent ended 25 cents firmer at $37.06.
MSCI’s broadest index of Asia-Pacific shares outside Japan added another 0.4 percent to reach a seven-week top, having surged 2.6 percent on Wednesday.
Higher prices for copper and iron ore helped Australian stocks rise 0.5 percent to their highest in over a month. Japan’s Nikkei was up 0.3 percent, following a 4-percent jump the previous session.
Energy and bank stocks had led Wall Street higher on Wednesday, giving the Dow a gain of 0.2 percent. The S&P 500 added 0.41 percent and the Nasdaq 0.29 percent.
The calmer mood showed in the CBOE Volatility index, a measure of investor anxiety, which closed at its lowest level so far this year.
Sentiment was underpinned by a report showing U.S. private sector jobs rose a surprisingly strong 214,000 in February, adding to speculation Friday’s payrolls report would also be upbeat.
Yet fissures remain in the global outlook, argued Justin Fabo, a senior economist at Australia and New Zealand Bank.
Despite the latest bounce in commodities, prices were still very weak and a lot of money had been borrowed on the assumption that they would not be.
“China has huge potential to roil markets as the nation navigates a difficult structural transition,” he said. “Asian trade, traditionally a bellwether for global growth, is in recession.”
“Risk is being repriced, and the ability of central banks to keep pulling rabbits out of the hat is now pretty limited.”
Indeed, there are plenty of worries the European Central Bank could disappoint expectations for aggressive easing when it meets next week – just as it did in December.
Back then markets reacted violently when the central bank’s stimulus steps stopped far short of what had been priced in, leading the euro to rocket 3 percent in just one session.
Fearing a re-run, investors are holding back on shorting the euro, keeping it at $1.0864 and off a one-month trough of $1.0825. The dollar also faded a little on the yen to 113.50 , after losing grip of a two-week high at 114.56.
Instead, the limelight was stolen by the Australian dollar which neared its 2016 peak in the wake of surprisingly strong domestic economic data.
The Aussie was taking in the view at $0.7285, following a 1.7 percent rally on Tuesday.
Investors warmed to the currency after data showed fourth quarter economic growth unexpectedly picked up to a healthy 3.0 percent annual clip.