Asia rides Wall St higher, buoyant crude nears 6-week highs
TOKYO, Aug 19 (Reuters) – Asian stocks edged up on Friday as Wall Street benefited from buoyant crude oil prices and expectations that US borrowing costs will remain at stimulatory levels at least until year-end.
Japan’s Nikkei added 0.5 percent and South Korea’s Kospi tacked on 0.2 percent. Australian shares added 0.1 percent.
MSCI’s broadest index of Asia-Pacific shares outside Japan stood steady. The index was on track to rise 0.25 percent on the week, during which it reached a 1-year high.
Global equities received a lift this week after the Federal Reserve’s July policy meeting minutes showed that the US central bank was in no hurry to hike interest rates.
"Markets breathed a collective sigh of relief that minutes from the Federal Reserve’s July meeting gave no clear indication that the Fed is ready to raise interest rates," wrote Jasper Lawler, a market analyst at CMC Markets.
"With central bank support, equities have been able to navigate thin summer trading and corporate reporting season with minimal volatility."
US stocks eked out gains on Thursday following upbeat earnings and forecasts from Wal-Mart and as higher oil lifted energy shares.
In currencies, the dollar remained on the defensive after sliding to an 8-week low overnight in response to the Fed’s minutes.
New York Fed President William Dudley, who said earlier this week that the central bank could possibly hike rates in September, reinforced his hawkish message on Thursday but that did little to support the bruised dollar.
The euro was little changed at $1.1344 after touching $1.1366 overnight, its highest since June 24. The common currency was headed to gain 1.7 percent this week.
The dollar was up 0.3 percent at 100.160 yen but still within sight of an 8-week low of 99.550 hit on Tuesday. It was on track to lose 1.1 percent on the week.
A weaker greenback tends to help commodities as it favours non-US buyers of dollar-denominated products.
In addition to a sagging dollar, crude oil has been boosted as the world’s largest producers prepared to discuss a possible freeze in production levels.
US crude was up 0.2 percent at $48.33 a barrel, within close reach of $48.38, its highest since July 5 scaled overnight. US crude was en route to rise 8.6 percent this week and Brent was poised to add 8.3 percent.
Both benchmarks have risen more than 20 percent from a low in early August on news the Organization of the Petroleum Exporting Countries (OPEC) and other key exporters may revive talks on freezing output levels when they meet in Algeria next month.
The rapid rise puts oil, technically, in a bull market.
Benchmark copper on the London Metal Exchange was flat at $4,8907 a tonne after rising 0.7 percent overnight.