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 Another day of steadier oil and currency prices supported the
brighter mood after a week marked chiefly by the woes of Britain's
pound at the start of a campaign over whether to leave the European
Union in a referendum in June.
Setting the tone for the Shanghai meeting of the Group of 20,
China's central bank chief, Zhou Xiaochuan, said Beijing still had
the room and tools to support the world's second largest economy.
Chinese and other Asian stock markets made guarded gains and
Europe's major markets were all up by around 2 percent. The yuan
currency, battered in January by speculation Beijing would have to
devalue sharply, was roughly steady.
Sterling gained around half a percent against the euro and dollar.
"The focus is definitely on the G20 meeting, which has the ability
to support the market, particularly the comments from Zhou... that
there is no basis for further yuan depreciation," said the head of
emerging market research at Credit Agricole, Sebastien Barbe.
"It is key for them to convince the market that they are not going
to enter into a currency war."
With the world economy facing its most serious crisis of confidence
since the global financial turmoil of 2008-9, economists and
officials have raised the prospect of governments pledging together
to spend more to bolster growth.
German Finance Minister Wolfgang Schaeuble, however, was quick to
declare that the scope for monetary and fiscal policy was exhausted
globally and called for more structural reform. Italian central bank
governor Ignazio Visco said markets should not expect concrete
action from the meeting.
"We’ll get supportive statements on the growth outlook remaining
decent and ... we’ll hear that policy options are still available if
growth were to take a much more significant dip downwards," said
Alvin Tan, a currency strategist with French bank Societe Generale
in London.
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"But despite the likely positive rhetoric, it’s going to be
rhetoric. We just don’t see any substantive co-ordinated measures
coming out of the G20."
MSCI's broadest index of Asia-Pacific shares outside Japan
gained just over 1 percent. South Korea was roughly flat,
while Japan's Nikkei gained just 0.3 percent.
Wall Street's S&P 500 scored its highest close since early January
on Thursday after oil staged a turnaround on speculation a March
meeting of major producers might stabilize prices.
U.S. crude rose 1.6 percent to $33.04 a barrel. Brent was 16
cents lower at $35.13.
On the British question, UK finance minister George Osborne said
that the pound's 3 percent fall in three days at the start of this
week was a warning that the "Brexit" debate was "not some political
parlor game".
The pound has recovered some ground since hitting 7-year lows
against the dollar on Wednesday and is now down 2.7 percent on the
week, its worst performance since 2010.
(Additional reporting by Shinichi Saoshiro in Tokyo; Editing by Toby
Chopra)
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