TOKYO Risk assets from Asian shares to oil climbed broadly on Thursday as much stronger-than-expected Chinese trade data magnified positive momentum from global markets overnight, strengthening signs of recovery in the world's second-largest economy.
European shares will likely track Asia higher. Financial spreadbetters predicted London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX would open as much as 0.2 percent higher. A 0.3 percent gain in U.S. stock futures hinted at a solid Wall Street start.
China's exports grew 14.1 percent in December from a year ago to hit a seven-month peak, handsomely beating market expectations of a 4 percent rise.
Imports grew only 6 percent on the year, still double the forecast, leaving a trade surplus of $31.6 billion from a surplus of $19.6 billion in November and sharply above a forecast of $19.7 billion.
But the outlook for 2013 remains cloudy with U.S. and European demand for Chinese goods still subdued.
"China has shown signs of cyclical recovery since last fall, and the trade figures offered a piece of evidence," said Tetsuro Ii, the chief executive of Commons Asset Management. "But the country is not expected to log as high a growth rate as in the past. Budget wrangling keeps downside risks for the U.S. economy intact while expectations remain low for European growth."
MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.7 percent, advancing immediately on the data after hovering around levels barely changed from Wednesday, and neared its highest level since August 2011 hit last week.
Hong Kong shares rose 0.8 percent to a new 19-month high, with gains picking up in growth-sensitive counters.
The economic report from China, Australia's largest trading partner, boosted Australian shares 0.3 percent higher and the Australian dollar up 0.3 percent to $1.0542, having hit a three-week high of $1.0554 at one point. The Australian dollar rose to as high as 92.98 yen, its highest since September 2008.
China's imports of iron ore rose 7.8 percent in December from the previous month to a record 70.94 million tonnes and its crude oil purchases edged up 1.3 percent for the month, preliminary data from the General Administration of Customs showed on Thursday.
London copper was up 0.3 percent at $8,100.50 a tonne while U.S. crude futures rose 0.4 percent to $93.48 a barrel and Brent futures added 0.1 percent to $111.86 as the Chinese data stoked hopes for firmer commodities demand.
"The growth in imports has been higher than expectations, which speaks highly for Chinese oil demand and global demand as a whole," said Michael McCarthy, chief market analyst, CMC Markets Sydney. "Clearly, it will be seen as a positive for oil."
WEAK YEN BOOSTS NIKKEI
Japan's benchmark Nikkei stock average advanced 0.8 percent as the yen resumed its weakening trend after a pause in the last couple of sessions, buoying exporters.
Foreign investors remained net buyers of Japanese stocks last week for an eighth consecutive week, government data showed on Thursday.
"Investors can't jump off the bus because this unusual 'Japan boom' among hedge funds is set to last until an election in July, with the government launching steps aimed at short-term positive impacts," said Ii at Commons Asset Management.
The Japanese economy is expected to recover a little in 2013 if Prime Minister Shinzo Abe's policies of massive fiscal spending, aggressive monetary easing and a weaker yen produce the momentum needed to lift Japan from stubborn deflation.
The dollar had risen about 12 percent over the past two months against the yen, contributing to the Nikkei's 22 percent jump in the same period, on expectations for bolder monetary easing from the Bank of Japan under Japan's new government.
The dollar was up 0.3 percent to 88.11 yen, inching closer to its highest since July 2010 at 88.48 reached on Friday. The euro was also up 0.1 percent to 114.95 yen. It last week hit 115.995 yen, its highest since July 2011.
The euro eased 0.2 percent to $1.3042 ahead of the European Central Bank's policy meeting, where it is expected to keep interest rates steady.
Spain will test investor appetite for its debt when Madrid holds its first debt sales of 2013 later in the session. The Spanish auction is being watched for clues on the timing of a much-anticipated request by the government for international financial aid.
Wariness over debt issues is not confined to the euro zone, with investors also watching U.S. debt ceiling negotiations after lawmakers narrowly avoided the fiscal cliff at the turn of the year.
Sentiment improved slightly in Asian credit markets, tightening the spread on the iTraxx Asia ex-Japan investment-grade index by 1 basis point.
(Additional reporting by Ramya Venugopal in Singapore and Maggie Lu Yueyang in Melbourne; Editing by Shri Navaratnam and Eric Meijer)