Asian shares extended gains on Wednesday while U.S. Treasuries and gold were capped as Wall Street's record close spurred a shift into riskier assets amid signs of a continuing U.S. economic recovery and globally accommodative monetary conditions.
European markets are seen easing from a rally, with financial spreadbetters predicting London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX would open down as much as 0.2%. A 0.1% rise in U.S. stock futures pointed to a steady Wall Street start.
Following a record high close in the Dow Jones industrial average overnight, the MSCI's broadest index of Asia-Pacific shares outside Japan gained 1%, adding to Tuesday's 1.3% surge. The index tumbled to a nine-week low on Monday.
Resources-reliant Australian shares and Chinese shares were among the top performers, encouraged by Tuesday's data showing the huge U.S. services sector grew in February at its fastest pace in a year and China announcing record public spending in 2013. Both factors boosted hopes of economic growth and demand for goods.
London copper held steady around $7,772 a tonne.
Australian stocks rallied 0.8% to a 4-1/2-year high as data showing the economy last quarter grew faster than its peers in the rich world in a 21-year run of expansion boosted sentiment.
Commodity-linked currencies, often related to risk appetite, firmed, with the Australian dollar rising 0.2% to $1.0291, above an eight-month low of $1.0116 plumbed on Monday.
Hong Kong and Shanghai shares rose 1%, respectively.
The dollar inched down 0.1% against a basket of key currencies.
U.S. crude rose 0.2 percent to $91.03 a barrel and Brent rose 0.3 percent to $111.91. Brent's front-month contract for April delivery rose late on Tuesday following news of Venezuelan President Hugo Chavez's death.
Niimura said the exit of Chavez from Venezuela's political scene would normally put downward pressures on oil prices, as the risk of manipulation such as controlling prices or supplies under Chavez's dictatorship dissipates with his passing.
Japan's Nikkei stock average closed 2.1% higher at a fresh 4-1/2-year peak.
BUBBLY OR NOT
Despite the increasingly positive mood, there are still some areas of concern, namely the Chinese government's move to dampen the country's overheated property market, a possible economic impact from the U.S. "sequestration" spending cuts, and last month's election deadlock in Italy.
But these worries have been eclipsed by a belief that major central banks stand ready to provide funding and monetary policy support to sustain the fragile recovery trend worldwide.
The Bank of Japan, the Bank of England and the European Central Bank all hold their policy meetings on Thursday.
The euro held steady around $1.3058. The dollar was down 0.2% against the yen at 93.08 yen.
Barclays Capital said in a note that despite the Dow's stellar performance overnight, implied volatility, the credit markets, and earnings imbalances are not yet flashing warning signs unlike in 2007 prior to the financial crisis.
Gold traded in a narrow range and hovered around $1,575 an ounce, as investors turned their back on assets perceived as relatively safe.
Ten-year Treasury yields inched up 1 basis point in Asia to 1.903%, keeping the yield near the top end of its 1.912% to 1.827% range seen over the past week.
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