China holds up stocks; oil gains on North Sea outage

HONG KONG: Asian stocks edged up on Wednesday, helped by a bounce in Chinese shares, though investors held off from making big bets before a highly-anticipated summit between US President Donald Trump and his Chinese counterpart Xi Jinping gets under way on Thursday.
European stocks were set to follow Asia’s steady lead with index futures pointing to a slightly higher start.
Chinese construction shares were among the top gainers after Beijing on Saturday announced plans to build Xiongan New Area, modelled on the Shenzhen special economic zone next to Hong Kong that helped kickstart China’s economic reforms in 1980.
“This is a very headline-driven market and the only source of optimism is the new economic zone news over the weekend — but that is unlikely to be sustainable,” said Conita Hung, an independent market strategist in Hong Kong.
Shares in more than 30 listed companies seen likely to benefit from the new zone jumped by the 10 per cent daily trade limit.
Mainland markets reopened on Wednesday for trading after a long weekend and outperformed regional bourses, rising more than 1 per cent.
Hong Kong stocks gave up early gains and were flat on the day.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.1 per cent, edging back towards a 19-month high hit on March 30.
India’s shares opened at a record high before retreating.
Energy-related shares also offered some support to investors as oil prices rose on Tuesday thanks to an unplanned production outage in the North Sea and growing concerns about diminishing US oil stocks.
US crude rose for a second consecutive session to its highest levels in more than a month at $51.37 per barrel on Wednesday.
Still, investors remained broadly cautious with safe-haven assets such as gold and Japanese yen remaining well supported before the landmark Trump-Xi summit on Thursday and Friday.
It will be their first face-to-face meeting since Trump took office on January 20, with trade and security issues set to feature prominently.
The Korean Peninsula has been a notable hot spot of geopolitical tensions, with North Korea firing a medium-range ballistic missile from its east coast into the sea on the eve of the summit.
“Markets are really on hold at the moment,” said Ric Spooner, Chief Market Strategist at CMC markets, adding that investors are looking to catalysts from the Trump-Xi meeting as well as the US earnings season.
Gold held near a one-month high at $1,254.45 per ounce, rising nearly 4.7 per cent in the last three weeks.
Major currencies traded in a narrow range ahead of the release of minutes from the Fed March meeting in which it raised interest rates, and before the big US jobs report on Friday.
The greenback got some help from Japanese importers on a ‘gotobi’ date — the fifth day of the month and dates that are multiple of five — on which accounts are settled.— Reuters