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 A strong rise in European bank shares, led by renewed optimism
surrounding Italy's fund to shore up weak lenders, and a positive
reaction to JP Morgan's first quarter earnings also lifted broader
indices.
Europe's FTSEuroFirst index of leading 300 shares posted its biggest
gain in a month, rising 2.1 percent to a two-week high of 1,334
points, and Germany's DAX and France's CAC also rose more than 2
percent .
U.S. futures pointed to a rise of 0.6 percent at the open on Wall
Street.
"China's trade data beat expectations, which lent further support to
risk sentiment today as reflected in the bounce in equity markets,"
Morgan Stanley strategists said.
China reported exports jumped 11.5 percent year on year in March --
the first increase since June, well above market forecasts, and a
huge improvement on February. [ECONCN]
Chinese stocks added 1.4 percent, while Japan's Nikkei rose 2.8
percent for its biggest daily gain in six weeks.
MSCI's broadest index of Asia-Pacific shares outside Japan added 1.7
percent, marking its sixth straight gain and longest winning streak
in six months.
Financials led the rally in Europe, with the region's main banking
index up more than 5 percent <.SX7P> as investors welcomed
assurances from Italy's economy minister that European authorities
won't block the country's bank fund.
Investors also gave a thumbs up to JP Morgan's first quarter
earnings. Net profit fell to $5.5 billion, but earnings per share
and revenue beat expectations, and its shares were up nearly 3
percent in pre-market trading.
OIL AT CRITICAL JUNCTURE
Oil prices, however, ran into profit-taking after having rallied
almost 20 percent in the last week.
Brent crude was down 1.5 percent at $44.02 a barrel, after
breaching the 200-day moving average around $43.50 on Tuesday -- the
first time it has scaled this key technical level in almost two
years.
U.S. crude lost nearly 2 percent to $41.40, easing back from a
four-month high, but also held above the 200-day moving average
around $40.95 as attention turns to this weekend's meeting of top
oil producers in Doha.
Saudi oil minister Ali al-Naimi ruled out an output cut, in comments
to Saudi-owned al-Hayat newspaper published on Wednesday.
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A rally in energy stocks helped Wall Street end Tuesday firmer
across the board. The S&P 500 energy sector <.SPNY> jumped 2.8
percent and the Dow industrials posted its best day in about a
month.
The lift in energy overnight boosted oil- and commodity-sensitive
currencies including the Canadian and Australian dollars to
multi-month peaks, but that rally fizzled out as oil headed lower
again.
Both currencies were down around 0.4 percent against the U.S.
dollar, which was in turn up two thirds of a percent at 109.20
yen, having climbed from a near 18-month trough around 107.63 set on
Monday.
The euro fell two thirds of a percent against the dollar to $1.1307,
helping the dollar index to climb two thirds of a percent to 94.584
and further away from its near eight-month low of 93.627 struck
recently.
"Markets are trading 'risk on', buoyed by better than expected China
trade data. In sympathy the dollar is bouncing back versus the euro
and yen, and in the near-term we think this correction can extend
further," BNP Paribas currency strategists said.
Short-term fair value for the euro is around $1.1243, they said.
U.S. Treasury bond yields rose as much as 2 basis points across the
curve, notably at the short end, while the dollar's strength helped
drive gold down more than 1 percent to $1,241 an ounce.
(Reporting by Jamie McGeever; Editing by Toby Chopra)
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