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By Bloomberg

Asian stocks rose, with the regional index headed for its biggest three-day advance in more than a year, as commodity shares increased amid a rally in crude oil and metals. Ruble forwards strengthened.

The MSCI Asia Pacific Index climbed 0.9 percent by 3:28 p.m. in Tokyo, bringing its gain since Dec. 18 to 3.4 percent. Australia’s S&P/ASX 200 Index jumped 1.9 percent and China’s benchmark stock index surged to a four-year high. Standard & Poor’s 500 Index futures were little changed. One-month ruble forwards climbed, while crude rose for a second day. Yields on 10-year Japanese debt fell to the lowest level since April 2013.

The Federal Reserve said last week that it would be patient over interest-rate increases, while signaling borrowing costs could be raised as early as April, spurring a surge in global stocks and declines in U.S. Treasuries. The Bank of England releases minutes of its Dec. 8 Financial Policy Committee meeting today, while data tomorrow may show U.S. growth was faster than initially estimated last quarter. Saudi Arabia’s oil minister said he’s is confident crude prices will rebound as demand recovers.

“In general, investors seem to be feeling that it’s safe to buy after the Fed’s shown that they’re not in a hurry to raise rates,” Shoji Hirakawa, chief equity strategist at Okasan Securities Co. in Tokyo, said by phone today. How oil “might move towards next week hasn’t become clear, so it could still disrupt markets.”

Oil Moves

Brent oil added 1.1 percent to $62.04 a barrel, extending Dec. 19’s 3.6 percent surge, the most since October 2012. The oil blend settled at $59.27 Dec. 18, the lowest close since May 2009 and is still down 44 percent this year. West Texas Intermediate crude gained 1.2 percent to $57.79 per barrel.

While currently staging a rebound, crude is still in a bear market as the largest U.S. oil output in 30 years collides with slowing global demand for the commodity amid signs of decelerating growth from China to Europe.

Saudi Oil Minister Ali Al-Naimi said at a conference in Abu Dhabi at the weekend that the market will recover and fossil fuel will remain the main source of energy for decades to come. Mohammed Al Sada, Qatar’s energy minister, called on producers outside of OPEC to cut their “irresponsible” output on the sidelines of the conference. The Organization of Petroleum Exporting Countries last month refrained from reducing its production target of 30 million barrels a day.

China Shares

The S&P/ASX 200 rose for a fourth day to the highest close since Nov. 14 as BHP Billiton Ltd., the world’s largest mining company, climbed 3 percent, and energy producers as a group jumped 4.1 percent to the highest in almost a month. New Zealand’s NZX 50 Index added 0.3 percent while the Kospi index in Seoul rose 0.7 percent.

China’s stocks rallied to the highest since 2010 before erasing gains. PetroChina Co. and Industrial & Commercial Bank of China Ltd., the two biggest stocks, gained more than 2 percent. The Shanghai Composite Index rose as much as 2.6 percent before retreating.

The Shanghai Composite is the best-performing primary equity index globally this year, followed by benchmarks in Venezuela and Pakistan, data compiled by Bloomberg show. Russia’s dollar-denominated RTS Index is the worst performer amid the retreat in oil and sanctions against the country over its involvement in the Ukraine conflict.

Fed Outlook

The S&P 500 recorded its biggest three-day rally since 2011 at the end of last week, rising 0.5 percent on Dec. 19 to 2,070.65. A gauge of implied volatility on the U.S. benchmark dropped last week, with the Chicago Board Options Exchange SPX Volatility Index, known as the VIX, sliding 22 percent, the most since the five days to Oct. 24.

Fed Chair Janet Yellen said last week that policy makers are likely to hold key rates near zero at least through the first quarter, even as the U.S. economy strengthens. The central bank, in a statement after its last meeting of 2014, replaced a reference to borrowing costs staying low for a “considerable time” with a pledge to be patient on the timing.

“Lower oil prices and the move toward a Fed rate hike represent good news, but they will generate financial market stress,” JPMorgan Chase & Co. analysts, led by Chief Economist Bruce Kasman, wrote in a report e-mailed Dec. 20. “The divergent global growth impulses that have delivered lackluster growth over the past two years are set to change.”

Ruble, Rupiah

The Bloomberg Dollar Spot Index, which tracks the greenback against 10 major peers, was down 0.1 percent after rising 0.4 percent Dec. 19 to its highest close since March 2009. The dollar weakened 0.2 percent to $1.2250 per euro after appreciating to $1.2220, matching the strongest level since August 2012. The rupiah added 0.4 percent to 12,439 per dollar in a fifth straight day of gains amid the revival in risk sentiment and demand for equities.

One-month ruble forwards strengthened more than 2 percent after Phoenix TV yesterday reported pledges of support for Russia from two Chinese ministers. The ruble tumbled about 41 percent against the dollar in the past six months amid concern a drop in oil would hurt the biggest energy exporter at the same time as it contends with U.S. and European sanctions.

Yields on Japanese government bonds due in a decade dropped by one basis point, or 0.01 percentage point, to 0.34 percent in a third day of declines.

The extra yield demanded on 30-year Treasuries over five- year notes shrank to 110 basis points today, data compiled by Bloomberg show. The difference has contracted from 223 basis points in January 2014, the widest this year. Rates on benchmark 10-year Treasuries dropped one basis point to 2.15 percent after jumping eight basis points last week.

The U.S. updates third-quarter gross domestic product tomorrow, with economists surveyed by Bloomberg predicting annualized growth will be revised up to 4.3 percent for the three-month period, from a previous estimate of 3.9 percent. Data on housing, goods orders and personal consumption in the world’s largest economy are also due this week.