Favorable U.S. Oil Production Data Triggers Equity Gains In Asia

Favorable U.S. Oil Production Data Triggers Equity Gains In Asia
An offshore oil platform is seen in Huntington Beach, California September 28, 2014. REUTERS/Lucy Nicholson

Asia shares on Thursday seemed to be trading on the news that U.S. oil production fell and hopes that talks to freeze oil production by OPEC members could restart. Foreign investors are also keeping a close eye on the meeting of Federal Reserve officials next week.

What happened in Japan?

Investors showed an appetite for Japanese equities, thus sending the Nikkei 225 Index up 2.7% at 17363.62. Reports that Iraq was interested in reviving crude production freeze-talks and the news that U.S. crude production slipped had a hand in Nikkei’s gains. The U.S. daily crude output fell to the lowest level last seen in October 2014. The report lifted the dollar, thus making Japanese stocks cheaper for foreign bargain hunters.

The gain in Japan shares also signaled fading concerns over the recent devastating earthquake that hit the country.

China’s Shanghai Composite rattled

The Shanghai Composite Index of China appeared to be gaining but couldn’t hold on to its gains until the closing bell. The index fell 0.66% to 2953.02. But the smaller Hang Seng was seen rallying up nearly 1.4%.

Taiwan Weighted gains ground

Taiwan shares edged higher, with stocks in Cement, Glass and Rubbers sectors leading the gain. As such, the Taiwan Weighted rose 0.64%.

Crude oil futures for June delivery rose 0.36% to $44.34 a barrel in Taiwan while Brent oil for delivery in June gained 0.39% to hit $45.98. Gold futures for June delivery rose 0.37% to $1259.00 an ounce in Taiwan trading.

Australia trading

In Australia, shares closed higher, primarily backed by massive gains in Metal & Mining, Energy and Resources industries. As such, the S&P/ASX 200 shot up more than 1% to 5272.70.

Crude oil contract for June delivery gained 0.61% to $44.45 a barrel in Australia and Brent oil for June delivery edged up 0.66% to $46.10. Gold contact for June delivery rose 0.07 to $1255.30 an ounce.

AUD/USD (AUDUSD) jumped 0.23% to 0.7813. The Aussie also gained ground against its Japanese counterpart yen, thus the AUD/JPY (AUDJPY) rose 0.07% to 85.68.

Shares in Europe were expected to take a cue from their Asian counterparts.