Tokyo: Asian markets were mixed on Monday, with a weaker yen lifting Japanese stocks to a six-week high, while a drop in the US unemployment rate failed to spur buying in a region that has rallied massively this year. European shares were lower.
Gold prices fell further after tumbling on Friday as the better-than-expected US labor report hurt demand for safe haven investments.
Japanese investors were heartened by the dollar`s recovery above the 90-yen line from 14-year lows below 85 yen a week ago, as well as encouraging news about the American economy — a major export market.
The US jobless rate unexpectedly dropped to 10 percent and only 11,000 jobs were lost during November, the lowest in two years. That suggests the slump there is easing — although Wall Street eked out only small gains Friday as investors mulled whether an improving economy will prompt the Federal Reserve to raise interest rates.
"Expectations that US rates may rise lifted the dollar, and stocks have reacted to that," said Takuro Hayashi, an equity analyst at Cosmo Securities in Tokyo. "We think the yen will keep weakening, so there`s room for Japanese stocks to rise toward year-end."
The dollar slipped back to 89.84 yen in Tokyo trading from 90.25 yen late Friday. The stronger the dollar, the better the exchange rate for Japanese exporters bringing home earnings from abroad.
As trading got started in Europe, Britain`s FTSE 100 was off 1 percent, Germany`s DAX lost 0.6 percent and France`s CAC-40 shed 0.6 percent. Stock futures augured losses Monday on Wall Street. Dow futures were down 55, or 0.5 percent, at 10,345.
Japan`s benchmark Nikkei 225 average rose for a sixth straight session, climbing 145.01 points, or 1.5 percent, to 10,167.60, the highest close since late October.
In Hong Kong, the Hang Seng index fell 173.19, or 0.8 percent, to 22,324.96 while in Australia the main index slipped 25.7 points, or 0.6 percent, to 4,676.50.
"The market gained too much recently so we`re seeing some profit-taking. Short-term traders are selling on good news" about the US jobs numbers, said Francis Lun, general manager of Fulbright Securities Ltd. in Hong Kong.
Asian markets have rallied powerfully from their lows in March on hopes the world economy was climbing out of recession. India`s market has gained over 77 percent so far this year while China`s is up 82 percent.
Elsewhere, South Korea`s Kospi gained 0.5 percent and Singapore`s benchmark climbed 0.4 percent. China`s Shanghai index gained 0.5 percent to 3,331.90 after the government pledged to maintain economic stimulus and easy credit policies at a top planning meeting.
In Tokyo, Japan Airlines rose 7 percent after reports over the weekend that the Japanese government is considering 700 billion yen (USD7.8 billion) in credit guarantees to the carrier.
This could give the cash-strapped airline, which lost USD1.5 billion in the six months through September, easier access to capital from banks and potential investors.
In New York on Friday, the Dow ended with a gain of 22.75, or 0.2 percent, to 10,388.90 after reaching a 2009 high of 10,516.70 in early trading.
The broader Standard & Poor`s 500 index rose 6.06, or 0.6 percent, to 1,105.98, after setting a 2009 high of 1,119.13. The Nasdaq composite index rose 21.21, or 1 percent, to 2,194.35, reaching a high for the year of 2,214.39.
Gold was down USD20.50, or 1.8 percent, to USD1,149 per ounce on the New York Mercantile Exchange, after tumbling nearly USD50 on Friday.
Oil prices hovered slipped to near USD75 a barrel in Asia after several OPEC ministers said they don`t expect their group to change production levels at a meeting later this month.
Benchmark crude for January delivery was down 26 cents to USD75.21 in electronic trading on the New York Mercantile Exchange. The contract lost 99 cents to settle at USD75.47 on Friday.
In currencies, the euro fell to USD1.4827 from USD1.4851.