China trade data push world shares to five-year highs

Exports and imports in China were up 14.7 and 16.8% respectively in April, giving a positive boost to stocks

Strong Chinese trade data pushed world shares to five-year highs on Wednesday and boosted growth-sensitive currencies and commodities, despite doubts about the quality of the figures.

Last Friday's upbeat US jobs data and this week's robust German industrial orders have driven up world stock markets, and the positive mood was cemented on Wednesday as China followed suit with the better-than-expected trade performance.

Exports and imports in the world's number two economy were up 14.7 and 16.8% respectively in April. However, economists believe that manoeuvring by exporters and speculative capital inflows are masking weakness in real global demand.

"I have no strong conviction whether the data reflects reality," said Zhiwei Zhang, chief China economist at Nomura in Hong Kong.

The equity market rally showed no sign of letting up as huge injections of liquidity from leading central banks to boost their economies outweighed the doubts about the Chinese data.

MSCI's world index, which tracks stocks in 45 countries, rose 0.3% to a five-year high as top European shares followed their Asian counterparts.

The FTSEurofirst 300, which reached its own five-year peak on Tuesday, opened up 0.3% as London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX climbed 0.1 to 0.3%.

"If you look at the (Chinese) data there is a pick-up but overall we are seeing a downtrend," said Daiwa Securities economist Tobias Blattner. "There isn't too much good news, but what we do know is that central banks are continuing to pump out stimulus."

In the currency market, the euro was up 0.25% on the day at $1.31, while the Australian dollar reached its intraday high of $1.0194 after the data from China, its biggest export market.

Copper and oil, two of the most sensitive commodities to global growth prospects, also climbed. Copper rose more than 1% to a new three-week high of $7,350 a tonne and Brent crude headed back towards $105 a barrel.

European bond markets saw a steady start to the day. Benchmark Bunds were little changed and were expected to rebound with investors set to snap up five-year German debt at an auction later after a recent sell-off.

Investors were also awaiting German industrial output numbers at 1000 GMT. Recent data have painted a mixed picture of the euro zone's largest economy as investors try to gauge the European Central Bank's next interest rate move.