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World stocks extend rally amid earnings optimism

Asian markets extended their winning streak Monday as hopes company earnings will rebound along with global growth continue to drive investors into stocks. European shares followed Asia higher.

Major benchmarks across Asia posted gains of 1 percent or more, while oil rose above $68 a barrel and the dollar strengthened against the yen. The first Chinese IPO on the country's main exchange in almost a year surged over 300 percent in its debut.

Improving company outlooks and economic data coupled with still-large amounts of uninvested cash have helped jump-start a rally in world equities that started in March but began to fade in June.

Whether the markets continue their run higher could hinge on another round of second-quarter results this week from major companies in the U.S. Visa Inc., Colgate-Palmolive Co. and ExxonMobil Corp. Big Japanese corporations, including Nissan Motor Co. and Sony Corp., also start reporting in the coming days.

Lucinda Chan, a director at Macquarie Private Wealth in Sydney, said investors are adding to their positions in stocks because they expect companies to make more optimistic forecasts, which would in turn reinforce faith in a global economic recovery.

"No one is running away. I think the fear of missing out is still strong, and there is this extreme appetite for risk right now," Chan said.

As trading got under way in Europe, Britain's FTSE 100 was up 0.1 percent, while benchmarks in Germany and France rose 0.6 percent each.

Earlier in Asia, Tokyo's Nikkei 225 stock average added 144.11 points, or 1.5 percent, to 10,088.66, and Hong Kong's Hang Seng rose 268.83, or 1.4 percent, to 20,251.62.

South Korea's Kosi gained 1.4 percent and Australia's stock measure was up by 1.2 percent.

In Shanghai, the main index climbed 1.9 percent, buoyed by the strong performance of the first company to list on China's main stock exchange in 11 months.

Sichuan Expressway Co. surged 324 percent to 15.25 yuan ($2.22) per share before falling back to end the day at 10.90 yuan ($1.59) — still a 203 percent gain over the price that shares were sold for in its initial public offering. The company was the first to start trading in Shanghai since regulators ended a ban on IPOs in June.

"I'm speechless. Even the most optimistic investors wouldn't have expected such a high price," said Cao Xuefeng, an analyst for Huaxi Securities in the western city of Chengdu.

Friday in New York, Wall Street added to its recent gains. The Dow rose 23.95, or 0.3 percent, to 9,093.24, its highest finish since Nov. 5. The S&P 500 index rose 2.97, or 0.3 percent, to 979.26.

Wall Street futures augured a mixed opening Monday. Dow futures gained 12, or 0.1 percent, to 9,070 while S&P futures fell 0.5, or 0.1 percent, to 977.30.

Investor hunger for riskier assets extended to commodities, with benchmark crude for September delivery gaining 67 cents to $68.72 barrel in Asian trade. On Friday, the contract rose 89 cents.

The dollar rose to 95.17 yen from 94.74 yen. The euro was higher at $1.4241 compared to $1.4224.

Associated Press researcher Bonnie Cao in Beijing contributed to this report.