Asia’s major stock markets posted modest gains on the week’s final day of trading, amid escalating tensions in the Middle East and oil prices notching their sharpest weekly gain in more than a year.
Investor focus was also on the key US non-farm payrolls report due later in the day, which would provide further clues on the Federal Reserve’s rate outlook.
Japan’s Nikkei rose but was set for a weekly loss of about 3%, after a choppy few sessions this week that saw investors weighing rising geopolitical tensions against the domestic rate outlook.
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The Nikkei share average edged up 0.22%, or 83.56 points, to close at 38,635.62, while the broader Topix was ahead 0.39%, or 10.36 points, to 2,694.07.
Prime Minister Shigeru Ishiba said this week that economic conditions in the country were not ripe for more rate hikes by the Bank of Japan (BOJ), reversing the hawkish tone he struck prior to his election victory.
The comments, coupled with more dovishness from other officials, sent the yen weakening past the 147 per dollar level, though it traded 0.46% higher on Friday and last stood at 146.27 per dollar. Still, the Japanese currency was headed for a weekly fall of 2.8%.
Hong Kong stocks advanced too, with traders still cheering China’s massive economic stimulus proposals. Mainland markets were closed for the week-long National Day break.
The Hang Seng Index gained 2.82%, or 623.36 points, to 22,736.87. The index is up 22% since September 24, when Beijing kicked off its rate cuts, and seemed set to overtake a late-January 2023 peak it hit earlier this week.
It is now up roughly 32% for the year and has dethroned Taiwan to become Asia’s best-performing stock market.
Elsewhere across the region, Indian stocks retreated with Mumbai’s signature Nifty 50 index down 0.86%, or 216.15 points, at 25,033.95. MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.16% and was set to end the week with a 0.5% increase.
US Ports Reopening
S&P 500 futures rose 0.04% while Nasdaq futures tacked on 0.1%. Eurostoxx 50 futures also added 0.1%.
US President Joe Biden said on Thursday that the US was discussing strikes on Iran’s oil facilities, when asked whether he would support Israel’s strikes in retaliation for Tehran’s missile attack on Israel.
Biden’s comments sparked a surge in oil prices, which had already been on the rise this week. Brent crude futures eased 0.14% to $77.51 a barrel on Friday but were headed for a weekly gain of about 7.7%, the largest since February 2023.
In some good news, US East Coast and Gulf Coast ports began reopening on Thursday night after dockworkers and port operators reached a wage deal to settle the industry’s biggest work stoppage in nearly half a century.
The dollar hovered near a six-week high ahead of the payrolls report that could decide the path of interest rates. Expectations are for the US economy to have added 140,000 jobs last month, slightly down from August’s 142,000 increase.
A slew of data releases this week pointed to a US economy still in solid shape, after the country’s services sector activity jumped to an 18-month high in September amid strong growth in new orders, while a separate report from the Labor Department on Thursday showed the jobs market gliding at the end of the third quarter.
That sent traders paring back bets of another 50-basis-point rate cut by the Fed next month, with futures pointing to just a 35% chance of such a scenario.
Elsewhere, spot gold rose 0.34% to $2,665.15 an ounce.
Key figures
Tokyo – Nikkei 225 > UP 0.22% at 38,635.62 (close)
Hong Kong – Hang Seng Index > UP 2.82% at 22,736.87 (close)
Shanghai – Composite <> CLOSED
London – FTSE 100 < DOWN 0.15% at 8,269.92 (0933 BST)
New York – Dow < DOWN 0.44% at 42,011.59 (Thursday close)
- Reuters with additional editing by Sean O’Meara
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