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Asia: Stocks end week on a positive, oil rebounds

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[HONG KONG] Asia stocks rose on Friday, ending the week on a positive note as oil prices rebounded and investors continued to weigh the impact of a possible US interest rate hike as early as June.

Markets were also eyeing a Japan meeting of finance ministers and central bankers from the G7 for fresh trading cues, where talks could highlight a sharp divide among the club of rich nations over how to rev up global growth.

Sentiment in Europe and the US had been slightly unsettled on Thursday following the disappearance of an EgyptAir plane in the Mediterranean with 66 people on board, but the unease appeared not to extend to Asia.

Tokyo and Sydney both gained 0.5 per cent, while Shanghai closed 0.7 per cent higher. Hong Kong was also up 0.9 per cent in the afternoon.

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Energy and commodity firms were among those lifted, as world oil prices advanced in Asian trade, with Brent crude back above US$49 a barrel.

US benchmark West Texas Intermediate advanced 0.6 per cent at US$48.47 and Brent crude was trading 0.5 per cent, higher at US$49.03.

In Hong Kong, China Shenhua Energy gained 3.3 per cent and PetroChina increased 0.8 per cent.

Sydney-listed mining giants BHP Billiton and Rio Tinto gained 0.8 per cent and 1.7 per cent respectively.

In global markets, investors had been focused on hawkish Fed statements Thursday, as one of the most dovish members of the policy board, William Dudley, said a rate increase will be on the table in the June 14-15 meeting.

Stephen Innes, senior trader at OANDA Asia Pacific, said investors will likely remain on guard until then.

"I expect markets to remain incredibly unsettled in the weeks leading up to the US FOMC (Federal Open Market Committee)," he said of the June meeting.

He added that "the Fed will likely gauge not only domestic US data but also factor in China's response as well as equity markets in their June decision".

Finance ministers and central bankers from the G7 meanwhile kicked off meetings in Japan, with talks likely to reveal differences over currency policy and how to breathe life into the wheezing global economy.

Host Japan is keen to win an endorsement for its position that fiscal stimulus is the way to kickstart the world economy, after a rally in the yen hit exporters and accelerated a slowdown at home.

But Tokyo's threat of a market intervention to reverse the rise could put it on a collision course with other G7 nations, including the United States and Germany, which have ruled out such moves.

"As uncertainty about the world economy has increased, macroeconomic policies and structural reforms" will be discussed, Japanese Finance Minister Taro Aso told an opening reception Thursday.

Separately, shares of airlines and travel companies were a mixed bag following news of the EgyptAir crash.

Japan Airlines slipped 1.2 per cent while rival All Nippon Airways eased 1.1 per cent.

But Cathay Pacific was up 2.2 per cent in Hong Kong, Qantas increased 0.3 per cent while Sydney Airport and Flight Centre Travel Group also gained.

Elsewhere, Taipei was 0.4 per cent higher after Taiwan swore in China-sceptic Tsai Ing-wen as the island's first female president, with an increasingly hostile Beijing looking on.

Ms Tsai took office after winning a landslide victory in January to defeat the ruling Kuomintang, ending an eight-year rapprochement with Beijing under outgoing president Ma Ying-jeou.

In early European trade London advanced 0.9 per cent, Frankfurt put on 0.8 per cent and Paris added one percent.


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