Asian stocks floated higher and the dollar was solid on Monday as investors, trickling back from their summer holidays, focused on signs of a recovery in the world's biggest economy.
Oil prices climbed after saboteurs set fire to a crucial Iraqi oil pipeline, extending Friday's gains after the largest power failure in North American history forced U.S. and Canadian refineries to shut down.
The dollar firmed in quiet Tokyo trade as market players returned from "obon" holidays expecting that U.S. consumer confidence and housing reports this week would probably show more evidence that economic growth was accelerating.
Tokyo's Nikkei stock average closed above the 10,000 level for the first time in a year as investors cheered signs of economic recovery in Japan.
The Nikkei gained 1.72 percent to 10,032.97, while the broader TOPIX rose 1.16 percent to 976.00 with big banks, steel makers and shipping firms leading the way.
"Investors are buying into an economic recovery spurred on by capital investment," said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments. "I don't believe we'll stop at 10,000. The Nikkei could easily reach 12,000 by next March."
FOREIGN BUYING
Japan's upbeat gross domestic product figures last week plus data on rising machinery orders, a key gauge of future capital investment, have helped fuel heavy buying by foreign investors betting on a stronger-than-expected recovery.
UJF Holdings surged almost 10 percent, Mizuho Financial gained 6.36 percent and steel maker JFE Holdings rose 5.23 percent.
South Korean stocks rose 0.43 percent to close at a 2003 high of 730.10, as speculation about possible mergers and acquisitions fired up Hyundai Group companies.
Taiwan stocks rose 0.51 percent, closing at a fresh 14-month high, while Australia finished with a 0.52 percent gain.
Singapore was up 1.51 percent at a 13-month high as investors welcomed planned changes to the state-run pension plan aimed at cutting business costs, while Hong Kong had gained 0.49 percent by mid-afternoon.
The broad Morgan Stanley Asia-Pacific index was 0.9 percent higher by 0630 GMT.
Asian stocks also took a cue from Wall Street, where the market shrugged off the blackout in the Northeast to finish higher.
Upbeat U.S. economic indicators in recent weeks, which have bolstered expectations of a swift recovery, were keeping the dollar buoyant.
In the latest such sign, the U.S. Federal Reserve said on Friday industrial production jumped an unexpectedly large 0.5 percent in July, posting its biggest gain since January. Reports on U.S. home construction consumer confidence are due on Tuesday.
"MOOD IS GOOD"
But the strong flow of foreign investment in Japanese stocks helped restrain the dollar's gains against the yen, traders said.
"The market's theme now is the U.S. economy and the mood is good, so the dollar was little hurt by the rise in the Nikkei," said Toru Umemoto, currency strategist at Morgan Stanley Japan.
The dollar had firmed to around 119.42 yen at 0630 GMT from 119.07 late Friday in New York. The euro was at $1.1228 down from $1.1259 after active selling by U.S. funds.
Dealers said the dollar could come under pressure during European and U.S. trading hours after remarks apparently from an al Qaeda spokesman that al Qaeda leader Osama bin Laden and Taliban chief Mullah Omar were alive and urging Muslims to fight a holy war against U.S. troops in Iraq.
Japanese government bond (JGB) prices fell to one-month lows, as the Nikkei breached the 10,000-level. Analysts said foreign players were building long positions in Japanese equities and selling JGB futures.
Yields on the benchmark 10-year Treasury note were unmoved in Asian trade at around 4.53 percent as investors waited to see how the New York market fares after the blackout.
Spot gold slipped about a dollar to $362 in Asian trade from its New York level on Friday, with the dollar's stronger trend making bullion more expensive to hold.
Crude oil for September delivery was up 36 cents to $31.41 as news of the pipeline fire and fresh concerns about a guerrilla war in Iraq hit a market already unnerved by the power outage and tight gasoline supplies in the United States.
Oil prices climbed after saboteurs set fire to a crucial Iraqi oil pipeline, extending Friday's gains after the largest power failure in North American history forced U.S. and Canadian refineries to shut down.
The dollar firmed in quiet Tokyo trade as market players returned from "obon" holidays expecting that U.S. consumer confidence and housing reports this week would probably show more evidence that economic growth was accelerating.
Tokyo's Nikkei stock average closed above the 10,000 level for the first time in a year as investors cheered signs of economic recovery in Japan.
The Nikkei gained 1.72 percent to 10,032.97, while the broader TOPIX rose 1.16 percent to 976.00 with big banks, steel makers and shipping firms leading the way.
"Investors are buying into an economic recovery spurred on by capital investment," said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments. "I don't believe we'll stop at 10,000. The Nikkei could easily reach 12,000 by next March."
FOREIGN BUYING
Japan's upbeat gross domestic product figures last week plus data on rising machinery orders, a key gauge of future capital investment, have helped fuel heavy buying by foreign investors betting on a stronger-than-expected recovery.
UJF Holdings surged almost 10 percent, Mizuho Financial gained 6.36 percent and steel maker JFE Holdings rose 5.23 percent.
South Korean stocks rose 0.43 percent to close at a 2003 high of 730.10, as speculation about possible mergers and acquisitions fired up Hyundai Group companies.
Taiwan stocks rose 0.51 percent, closing at a fresh 14-month high, while Australia finished with a 0.52 percent gain.
Singapore was up 1.51 percent at a 13-month high as investors welcomed planned changes to the state-run pension plan aimed at cutting business costs, while Hong Kong had gained 0.49 percent by mid-afternoon.
The broad Morgan Stanley Asia-Pacific index was 0.9 percent higher by 0630 GMT.
Asian stocks also took a cue from Wall Street, where the market shrugged off the blackout in the Northeast to finish higher.
Upbeat U.S. economic indicators in recent weeks, which have bolstered expectations of a swift recovery, were keeping the dollar buoyant.
In the latest such sign, the U.S. Federal Reserve said on Friday industrial production jumped an unexpectedly large 0.5 percent in July, posting its biggest gain since January. Reports on U.S. home construction consumer confidence are due on Tuesday.
"MOOD IS GOOD"
But the strong flow of foreign investment in Japanese stocks helped restrain the dollar's gains against the yen, traders said.
"The market's theme now is the U.S. economy and the mood is good, so the dollar was little hurt by the rise in the Nikkei," said Toru Umemoto, currency strategist at Morgan Stanley Japan.
The dollar had firmed to around 119.42 yen at 0630 GMT from 119.07 late Friday in New York. The euro was at $1.1228 down from $1.1259 after active selling by U.S. funds.
Dealers said the dollar could come under pressure during European and U.S. trading hours after remarks apparently from an al Qaeda spokesman that al Qaeda leader Osama bin Laden and Taliban chief Mullah Omar were alive and urging Muslims to fight a holy war against U.S. troops in Iraq.
Japanese government bond (JGB) prices fell to one-month lows, as the Nikkei breached the 10,000-level. Analysts said foreign players were building long positions in Japanese equities and selling JGB futures.
Yields on the benchmark 10-year Treasury note were unmoved in Asian trade at around 4.53 percent as investors waited to see how the New York market fares after the blackout.
Spot gold slipped about a dollar to $362 in Asian trade from its New York level on Friday, with the dollar's stronger trend making bullion more expensive to hold.
Crude oil for September delivery was up 36 cents to $31.41 as news of the pipeline fire and fresh concerns about a guerrilla war in Iraq hit a market already unnerved by the power outage and tight gasoline supplies in the United States.
3287.99
1275.09