Upbeat China PMI boosts Asia equities, Aussie; oil up on Iraq

Mon Jun 23, 2014 1:55am EDT
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By Shinichi and Saoshiro

TOKYO (Reuters) - Asian stocks and the Australian dollar rose on Monday as upbeat news from China's factory sector and fresh highs on Wall Street fuelled appetites for riskier assets, while crude oil held near nine-month highs as fighting in Iraq intensified.

Financial spreadbetters saw a marginally higher open for Europe markets with geopolitical risks tempering economic optimism. Britain's FTSE .FTSE was seen opening up to 0.1 percent higher, Germany's DAX .GDAXI up 0.15 percent and France's CAC .FCHI 0.1 percent higher.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS climbed 0.5 percent.

Gains by China shares were tepid with a liquidity squeeze resulting from new initial public offerings (IPOs) expected to linger through the month. .SS

Tokyo's Nikkei .N225 was up 0.2 percent after some of its earlier gains were erased.

The MSCI index hit intraday highs after the June HSBC/Markit Flash China PMI showed China's factory sector activity expanded for the first time in six months in June, offering new signs the economy is stabilising thanks to Beijing's measures to shore up growth.

"This month's improvement is consistent with data suggesting that the authorities' mini-stimulus is filtering through to the real economy," said Qu Hongbin, chief economist for China at HSBC, referring to a series of measures announced by the government in recent months to spur activity.

"We expect policymakers to continue their current path of accommodative policy stance until the recovery is sustained," he added.   Continued...

Pedestrians standing in front of an electronic board showing the various countries' stock market indices outside a brokerage are reflected in a polished stone surface, in Tokyo May 13, 2014. REUTERS/Yuya Shino