OVERNIGHT

Is it just a case of grasping at straws or wishful thinking? Asian shares rallied overnight apparently based on China's latest trade data. Coming in better than expected, Chinese exports for December rose 2.3% in yuan-denominated terms from last year. Imports dropped 4%.

In dollar terms, exports fell but not neatly as much economists expected, dropping 1.4 % much less than the 8% decline  predicted by 15 Wall Street economists. In real terms it was the sixth
straight down month. As reported in the WSJ : On Wednesday, official data showed China’s exports measured in dollar terms fell for the sixth straight month in December compared with a year earlier, underscoring the headwinds faced by the world’s second-largest economy. Exports slid 1.4% in December, following a 6.8% drop in November.

So, much of the cheering is trend based. Meanwhile. Share prices in Japan, Australia and even China rallied on the apparent good news. In a word, stabilizing became the word of the session as investors hope for more of such in the yuan and in the Chinese economy. The U.S. dollar gained as the yen and euro eased and the hope for more stability helped crushed commodities as oil closed above $30 a barrel after trading earlier at $29.93 before rallying.

Any real sign of stability should prove beneficial to the energy sector.