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Energy firms lead Asia markets higher

Hong Kong - Energy firms led a rally in Asia equities markets on Wednesday after oil prices soared on hopes for a deal by producers to cut output, while the dollar settled back after its latest gains.

The advance on trading floors is the latest in a volatile week for global markets after Donald Trump's shock election victory, which has fanned uncertainty for the US and world economy.

News that the Organisation of the Petroleum Exporting Countries (OPEC) exporters club and non-member Russia were engaged in a push to agree a deal fuelled a rush back into crude, which has in recent weeks been hit by worries over the chances of a cut as well as a strong dollar.

Both main contracts rallied almost 6% on Tuesday on renewed hopes OPEC can reach a deal before it holds its twice-yearly meeting at the end of the month.

"With OPEC production at record highs, meaning any cut has to get bigger by the day, any news that this mountain can be climbed by November 30th is seized upon," Jeffrey Halley, senior market analyst at OANDA, said in a note.

"With fast money flows dominating so many other markets at the moment it is no surprise that it was oil's turn," he said, adding: "We can expect more of this intra-day volatility over the next two weeks."

While Brent and West Texas Intermediate dipped in Asia on Wednesday, the surge in crude lit a fire under regional energy-linked firms.

Among the big winners, Hong Kong-listed CNOOC soared 2.5%, Woodside Petroleum jumped more than three percent in Sydney and Inpex was almost four percent higher in Tokyo.

Dollar strength

The gains filtered through to broader markets, with most major indexes tracking another record close on Wall Street.

Tokyo jumped 1.2% by the break as another jump in the dollar provided further support for exporters.

The greenback touched ¥109.34 at one point late on Tuesday before easing back, although it is still hovering around the ¥109 mark in Asia.

Analysts are tipping the dollar to hit the ¥110 range soon as investors bets on a sharper rise in US interest rates after Trump pledged to ramp up spending and cut taxes.

Hong Kong added 0.3% and Sydney and Singapore each put on 0.2% while Seoul was up 0.6%. However, Shanghai eased 0.2%.

Emerging economy markets - dragged by worries over Trump's plans for US trade deals - also staged a second day of gains as the volatility fuelled by the tycoon's election eases.

Manila, Taipei and Jakarta were all comfortably higher, although traders remain on edge.

The rally across Asia follows another advance in New York, where the Dow clocked up its fourth consecutive record high close and the S&P 500 and Nasdaq also surged.

A Commerce Department report showing retail sales solidly up in October also provided support.

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