By Shinichi Saoshiro
TOKYO (Reuters) - Asian stocks on Monday moved further away from four-year lows struck last week, as a cold spell in parts of the northern hemisphere pushed oil prices higher and relieved some of the bearish pressure on global markets.
World equities also took heart from the European Central Bank last week signalling additional monetary easing steps to come, raising hopes that other central banks, like the Bank of Japan, would take the same path.
Spreadbetters forecast a higher open for Britain's FTSE, Germany's DAX and France's CAC against the positive backdrop for equities.
The dollar stood tall, notably against the safe-haven yen, as risk aversion eased slightly for now and pushed U.S. Treasury yields higher.
MSCI's broadest index of Asia-Pacific shares outside Japan rose 1.5 percent, putting further distance between a four-year low plumbed last week.
More From This Section
Shanghai stocks added 1 percent and Tokyo's Nikkei, which slumped to a one-year low last week, rose 1.2 percent. Australian shares advanced 1.8 percent to a two-week peak.
"The latest rebound in oil, combined with European and Japan central bank's hinting at further stimulus, has provided a short-term reprieve for what so far this year, can be described as a nervous and punishing market," said Gary Huxtable, client adviser at Atlantic Pacific Securities.
On Friday, the S&P 500 rose 2 percent and the Dow added 1.3 percent Friday as a cold snap in North America and Europe caused a rally in oil prices. The S&P energy sector surged 4.3 percent.
Both the Federal Reserve and Bank of Japan hold policy meetings this week, with the Fed meeting on Jan. 26-27 and the BOJ gathering immediately after, on Jan. 28-29.
Investors will look for any hints of when the Fed intends to make a second interest rate hike, while there is speculation that the BOJ could opt to take additional easing measures.
"We expect no action from the Fed or BOJ, although investors will be looking for a more dovish forward bias as the renewed decline in oil prices lowers inflation expectations globally," wrote strategists at Barclays.
Risk aversion amid fears of a China-led global economic slowdown and oil prices sinking to 13-year lows had rocked global markets at the start of the year, and the lull in flight-to-quality seen towards the end of last week weighed on safe havens like U.S. Treasuries and the Japanese yen.
The benchmark 10-year Treasury yield nudged up to 2.06 percent after rising to as high as 2.089 percent on Friday, the highest in a week.
The dollar was steady at 118.725 yen after surging 0.9 percent on Friday, when it touched a two-week high of 118.88. The euro was little changed at $1.0812 after losing 0.8 percent on Friday.
The Australian dollar, sensitive to the ebb and flow in risk appetite and fluctuations in commodity prices, was up 0.2 percent at $0.7022 after touching a nine-day high of $0.7046 on Friday.
Crude, recently under pressure from a global glut, jumped as harsh winter weather on the U.S. East coast boosted demand for heating oil. U.S. crude climbed 9 percent and Brent bounced 10 percent on Friday.
U.S. crude was last up 0.9 percent at $32.49 a barrel. The contracts had descended to as low as $26.19 last week, their lowest since May 2003. Brent crude rose 1.3 percent to $32.59 a barrel after dropping on Wednesday to $27.10, lowest since November 2003.
Recently battered oil-linked currencies enjoyed a boon on crude's sharp rebound. The Canadian dollar traded near an 11-day high of C$1.4115 per dollar hit on Friday, having jumped from a 13-year low of C$1.4689 reached earlier last week.
(Additional reporting by the Sydney and Wellington newsrooms; Editing by Simon Cameron-Moore)