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Asian shares rose on Thursday, with recovering commodities and views that a run of weak global economic data will encourage major central banks to keep or deepen their monetary stimulus improving risk sentiment, but weak data undermined the dollar.
European stock markets were seen subdued, with financial spreadbetters predicting London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX would open narrowly mixed between a 0.1% rise and a 0.1% drop.
U.S. stock futures were up 0.1%, hinting at a calm Wall Street open.
MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.7%, with Hong Kong shares rising 1.1% and hitting a three-week high, spurred by recovering commodity prices and positive quarterly earnings from China Minsheng Bank, the country's seventh-largest lender.
South Korean shares gained 0.4% as metals and chemicals rebounded on higher gold and oil prices, taking in their stride earnings from Hyundai Motor Co which showed a 15% fall in its quarterly net profit, broadly in line with forecasts.
Early on Thursday, South Korea said its economy grew a seasonally adjusted 0.9% in the January-March period from the previous quarter, the fastest in two years and far above market expectations. The surprising growth dented expectations for a rate cut by the Bank of Korea.
Adrian Foster, head of financial markets research for Asia-Pacific at Rabobank International in Hong Kong, said the main factor behind an improved tone in the region was the recent rally in the peripheral European government bond market which reflected waning fears about a euro zone implosion.
"We've already been seeing the market evolve from the European crisis to focus more on specific issues in a country or events," he said, adding that it was a positive development that investors were reverting to behaviour seen before the financial crisis.
U.S. equities were also underpinned by earnings prospect despite recent soft economic reports, with 68.4% of the 174 companies in the S&P 500 index that already have reported results exceeding analysts' expectations, according to Thomson Reuters data through Wednesday morning.
The euro zone debt crisis has taken a toll on the European economy but that has simultaneously strengthened the case for more easing, raising expectations of a rate cut by the European Central Bank when it meets next week.
Despite the rate cut speculation and weak euro zone data, the euro was up 0.3% at $1.3050 and away from Wednesday's three-week low of $1.2954. The resilience of the single currency partly stemmed from falling yields in highly-indebted Italy and Spain and hopes Italy will break its political deadlock two months after an inconclusive election.
The ECB rate cut speculation also helped offset growth concerns highlighted by U.S. durable goods posting their biggest drop in seven months in March and the Ifo survey showing that German business sentiment in April fell further than the most bearish forecasts.
The U.S. Federal Reserve meets next week and is expected to reaffirm its commitment to its bond-buying stimulus programme.
"Recent concerns have emanated from weak manufacturing data in China, the euro zone and the U.S., but none of these economies have plunged off a cliff," said Thomas Lam, chief economist at DMG & Partners Securities in Hong Kong.
"Probably we will see some stabilisation in the near term, based on expectations that central banks will, if not extend easing, then delay any normalisation of policy," he added.
NIKKEI POWERS AHEAD
Japan's Nikkei stock average rose 0.7% and hit its highest since June 2008, as a weakening yen bolstered expectations for improved corporate earnings.
Most observers have welcomed an April 4 decision by the Bank of Japan to embark on a radical monetary expansion campaign that could help the global economy. The BOJ plans to inject about $1.4 trillion into the world's third-largest economy in less than two years in an effort to end two decades of stagnation.
"The weaker yen is having a positive effect on companies' earnings, which in turn is lifting stocks," he said. "For now, we see this trend continuing," said Hiroichi Nishi, an assistant general manager at SMBC Nikko Securities.
Japan's capital flows data showed on Thursday that Japanese investors remained net sellers of foreign bonds, in line with comments from big life insurers that they remain cautious about immediately shifting their money out of Japanese government bonds into foreign bonds.
Japanese investors sold a net 862.6 billion yen of foreign bonds in the week to April 20, while foreign investors turned net sellers of Japanese shares.
The dollar was down 0.1% at 99.33 yen, still within sight of testing the symbolic 100 yen level which many traders say is just a matter of time. Against a basket of key currencies, the dollar was down 0.4%.
U.S. crude rose 0.5% to $91.89 a barrel and Brent was up 0.4% at $102.13.
Spot gold was up 0.8% at $1,442.16 an ounce while London copper rose 0.8% to $7,086 a tonne, a one-week high.
