Asian stocks hit three-year peak on upbeat US data

MSCI’s broadest index of Asia-Pacific shares outside Japan near highest levels since May 2011

A pedestrian  walks past an electronic board showing the stock market indices of various countries outside a brokerage in Tokyo. Photograph: Yuya Shino/Reuters

A pedestrian walks past an electronic board showing the stock market indices of various countries outside a brokerage in Tokyo. Photograph: Yuya Shino/Reuters

Fri, Jul 4, 2014, 08:09

Asian shares rose to a three-year peak on Friday, though the dollar inched away from overnight highs hit on USjobs data which underscored the strength of the economic recovery.

European stocks were seen taking a breather after recent gains, with financial spreadbetters expecting Britain’s FTSE 100 to open 3 points higher and Germany’s DAX to open between flat and 1 point higher, both unchanged in percentage terms.

France’s CAC 40 was expected to edge 7 points lower, or 0.2 per cent.

MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.2 per cent, touching its highest levels since May 2011 and on track for a weekly gain of 1.7 per cent.

Japan’s Nikkei stock average rose 0.6 per cent to hit a 5.5 month high, and gained 2.3 per cent for the week.

US nonfarm payrolls rose by 288,000 last month and the unemployment rate fell to 6.1 percent. Employment has grown at more than 200,000 in each of the last five months, the first such streak since the late 1990s.

The report helped the Dow Jones industrial average pass the 17,000 milestone and the benchmark S&P 500 rise to within 1 per cent of the 2,000 level.

The data also pushed up the benchmark US Treasury yield to a two-month high, which in turn burnished the dollar’s appeal. The benchmark 10-year yield last stood at 2.641 per cent, not far from its US close of 2.648 per cent on Thursday, when it rose as high as 2.69 per cent.

The dollar edged slightly down against the yen to 102.04 yen , but remained not far from a two-week peak of 102.26 yen touched on Thursday, when it marked its largest daily gain in a month.

The dollar index, which tracks the greenback against a basket of rivals, stood 80.225, steady from late US levels after marking a one-week high of 80.315 in the wake of the jobs report.

In commodities, spot gold inched down to $1,321.60 an ounce after dropping in line with the stronger dollar, and the record highs on Wall Street diminished its safe-haven appeal.

US crude was down about 0.1 per cent from late US trade at $103.97 a barrel. It was on track to post its biggest weekly loss in a month on receding worries about supply from Libya and Iraq, although expectations of an improvement in the outlook for demand in the world’s top oil consumer checked its losses.

Copper was steady at $7,176.25 a tonne after earlier hitting a 4.5 month high, and looked set for its biggest weekly advance since September last year.

Reuters