Australia stocks surge 4%; oil prices drop as OPEC and its allies delay meeting

Stocks in Asia Pacific rose in afternoon trade as a scheduled meeting between the Organization of the Petroleum Exporting Countries and its allies, initially set to take place Monday, was delayed.

Shares in Australia led gains among the region’s major markets, with the S&P/ASX 200 gaining 4.3% as shares of the country’s major banks such as Commonwealth Bank of Australia and Westpac gained more then 4% each.

Over in Japan, the Nikkei 225 rose 2.53% as shares of index heavyweight Softbank Group soared 5.28% while the Topix index added 2.31%.

South Korea’s Kospi also advanced 2.77% in afternoon trade, while the Kosdaq index rose 3.25%. Hong Kong’s Hang Seng index edged 1.11% higher by the afternoon.

Overall, the MSCI Asia ex-Japan index was 1.34% higher.

Markets in China are closed on Monday for a holiday.

Developments on the global coronavirus virus pandemic continue to be watched, as concerns over the virus’ economic impact have sent markets into a whirlwind in recent weeks. Globally, more than 1.2 million have been infected while at least 65,711 lives have been taken by the virus, according to data compiled by John Hopkins University.

While there’s “a lot of uncertainty still,” TD Securities’ Mitul Kotecha told CNBC’s “Street Signs” on Monday that there appears to be signs that the virus may be slowing down in some places. That may fuel “optimism that the lockdowns may not need to persist for a prolonged period of time,” said Kotecha, senior emerging markets strategist at TD Securities.

Still, he warned that it’s “very, very early days” and “the economic news is still getting worse.”

“It’s gonna be a real battle in the days ahead between poor economic data and hopes of some sort of flattening of the curve in countries in Europe and in the U.S., for instance,” he said.

Investors also remained focused on oil prices. A scheduled meeting between OPEC and its allies  collectively referred to as OPEC+  was pushed back, raising fears that a production cut might face challenges.

Oil prices fell following that news, but recovered losses in the afternoon of Asian trading hours.International benchmark Brent crude futures down 1.64% to $33.55 per barrel. U.S. crude futures also dropped 2.75% to $27.56 per barrel.

Last week, both Brent and U.S. crude futures surged to their best week on record as Saudi Arabia called for a OPEC+ meeting, signalling there could be progress on a production cut. But tensions between Saudi Arabia and Russia escalated on Friday, and the meeting will now “likely” be held on Thursday, according to sources familiar with the matter.

The organization’s March meeting ended with no deal after Russia rejected Riyadh’s proposed output cut that had been made in a bid to prop up falling oil prices as the coronavirus outbreak sapped demand. This kicked off a price war between the two powerhouse producers.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was last at 100.688 after crossing the 100 level last week.

The Japanese yen traded at 108.82 per dollar after weakening from levels below 107.4 last week. The Australian dollar changed hands at $0.6017 after declining from levels above $0.609 last week.

— CNBC’s Pippa Stevens contributed to this report.

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