Singapore: Japanese stocks hit a 15-month high on Friday as the yen eased against the dollar, leading Asian shares higher, while gold and oil prices fell amid lingering concerns over possible central bank policy tightening in China.
The MSCI index of Asia Pacific stocks outside Japan rose inched up 0.2% but were still off 17-month highs hit earlier this week.
A similar Thomson Reuters index rose nearly 0.7%.
Japan’s Nikkei average rose 0.8%, with exporters such as Honda Motor Co buoyed by the yen’s weakness, while memory chip-related stocks climbed on growing global demand for high-tech products.
“Shares of exporters will likely continue to fare well for a while, helped by the weakening yen,” said Kenichi Hirano, operating officer at Tachibana Securities.
US shares edged higher overnight on optimism about the economy, though traders were cautious ahead of the non-farm payroll data later in the day. The latest Reuters poll suggested the US economy stopped shedding jobs in December.
The dollar hit a fourth-month high against the yen on Thursday on growing expectations for an upbeat US jobs report, but it later gave up gains after new Japanese finance minister Naoto Kan said markets should decide exchange rates.
Kan said on Thursday he wanted the yen to weaken to help the country’s exporters, raising the possibility of intervention by Japanese authorities and sparking a sell-off in the currency.
The dollar edged up 0.1% to 77.977 against a basket of six major currencies
The U.S. dollar also got help from US regulators urging banks to protect themselves against hikes in interest rates, supporting views that the Federal Reserves will start raising interest rates this year.
Chinese shares fell 0.9%, extending Thursday’s near 2% drop after a surprise move by China’s central bank to raise the interest rate on its three-month bills.
The move sparked fears that policymakers were getting ready to use more forceful measures to cool growth and fight inflation, and also prompted a sell-off in commodities as traders feared policy tightening would curb China’s appetite for resources from metals to crude oil.
Global investors are increasingly focused on when central banks will unwind emergency growth-stimulus measures put in place during the global financial crisis. Withdrawing them too soon could undermine still fragile economic recoveries, while leaving them in place too long could trigger inflation and potentially sow the seeds of another crisis.
Central banks in South Korea, India and the Philippines have all talked explicitly this week about exit strategies.
Shanghai copper prices fell 1 percent, following weakness in London in the previous session on fears of China’s policy tightening.
Spot gold shed 0.6% to $1,124.75 per ounce, extending Thursday’s losses. Prices climbed 4 percent in the first three trading sessions of 2010 to a three-week.
Crude oil for February delivery was down 40 cents, or 0.5% to $82.26 a barrel, falling further from a 15-month high hit on Wednesday.