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Asia: Stocks buoyant after US jobs, oil extends gains
[HONG KONG] Asian stocks began the week in a mostly buoyant mood on Monday, cheering a strong pick-up in US job creation while weighing China's decision to lower its annual economic growth target at the weekend.
Energy firms were again among the biggest gainers as oil continued its recovery thanks to the jobs data and as US producers cut the number of rigs in operation to combat a global supply glut that has hammered prices.
At the start of its annual policy congress Saturday China set a target of 6.5-7.0 per cent expansion this year - as expected - as it looks to combat a slowdown in global trade and transition from dependence on exports and investments to consumer-led growth.
But in a two-hour speech, Premier Li Keqiang promised to loosen the money belt and projected the biggest budget deficit in several decades, putting on the back-burner its drive to combat bulging government debt.
He also pledged reform of the country's mammoth state-owned enterprises, many of which are plagued by inefficiencies and overcapacity.
China's leaders have sought to reassure jittery global markets in recent weeks with a unified message that authorities still have the tools to keep the economy - a key driver of world growth - from a further slowdown.
Shanghai stocks were up 0.5 per cent in mid-morning trade, with investors also cheered by an expected delay in a plan to speed up initial public offerings. Among other markets Sydney was up one percent and Seoul put on 0.3 per cent. There were also gains in Taipei, Manila and Jakarta.
But Hong Kong was 0.1 per cent lower after last week's gains, while Tokyo slipped 0.4 per cent by the break after climbing around six percent last week.
More good news out of the United States also provided a platform from which to rally as the Labor Department reported the economy added 242,000 jobs in February.
While the data also showed a drop in wages the figures came after better-than-expected US reports on private jobs, the manufacturing sector, construction spending and auto sales.
The results came as some relief for markets, which in the first two months of the year were wracked by concerns of a global recession as economies from China and Australia to Europe and the Americas struggle.
"It is highly unlikely that the world economy could go into recession. The US recovery remains intact and we have not had a global recession without a US recession in probably 100 years," Matthew Sherwood, head of investment strategy at Perpetual in Sydney, said in an email to clients, according to Bloomberg News.
Oil prices pushed upwards again as US firms cut their rig count while traders grow increasingly confident producer giants led by Russia and Saudi Arabia will work to temper output.
In early trade US benchmark West Texas Intermediate was up 1.8 per cent and Brent was 1.7 per cent higher.
The slight recovery in the commodity also boosted energy firms, with BHP Billiton in Sydney up five percent and rival Rio Tinto more than three per cent up. In Hong Kong CNOOC was 1.7 per cent higher at PetroChina climbed 2.3 per cent.