Asian stocks climb with US, European futures; oil rallies

Asian stocks rallied with US and European equity index futures as commodities advanced amid optimism central banks in some of the world’s leading economies will step up monetary stimulus. The MSCI Asia Pacific Index built on its biggest weekly advance since April, with rawmaterials producers at the forefront of the rally.

ASIAN STOCKS rallied with US and European equity index futures as commodities advanced amid optimism central banks in some of the world’s leading economies will step up monetary stimulus.

The MSCI Asia Pacific Index built on its biggest weekly advance since April, with raw-materials producers at the forefront of the rally. Brent crude extended gains above $50 a barrel as silver exceeded $ 20 an ounce for the first time in two years and gold climbed for a fourth day. Nickel rose to an eight-month high amid concern output will be disrupted in the Philippines. Australia’s bonds fell after a national election at the weekend failed to deliver a conclusive winner.

The UK’s June 23 vote to leave the European Union (EU) has fueled expectations that monetary authorities in Europe and Japan will add to record stimulus, while killing off speculation that the Federal Reserve will raise interest rates this year.

Global equities last week rallied by the most in four months as policy makers worldwide sought to reassure investors they would take steps to limit the economic fallout of so-called “Brexit” and ensure financial markets keep functioning. The securities tumbled by the most since 2008 on the day after Britain’s referendum.

“While the potential for increased liquidity from central banks has helped calm stock markets, there’s still a lot of uncertainty out there,” said Nicholas Teo, a trading strategist at KGI Fraser Securities in Singapore.

“With China still on a slowdown, US recovery tentative and the messy UK-EU divorce, volatility will remain heightened.”

China’s official factory gauge retreated to the dividing line between improvement and deterioration last month, while a measure of services perked up, weekend data showed.

A Bank of Japan report on Monday revealed the nation’s companies cut their forecasts for inflation for five years’ time, adding to pressure on the central bank to boost stimulus.

More than 80% of 43 economists surveyed by Bloomberg last week said they expect the European Central Bank to add more stimulus, up from 67% in a similar poll conducted at the end of May. Of those who expect action, 90% said it will come at one of the next two meetings, either July 21 or Sept. 8, considerably more than said the same in May.

S&P 500 futures rose 0.3% and contracts on the UK’s FTSE 100 Index were up 0.6%.

The MSCI Asia Pacific Index gained 0.7%, after rebounding 3.5% last week. Hong Kong’s Hang Seng Index climbed 1.6%, lifting the benchmark to levels last seen before the UK’s referendum.

Brent crude rallied 0.6% to $50.67 a barrel.