HONG KONG (Reuters) - Asian shares advanced on Friday, warmed by the embers of a strong day on Wall Street which also supported risk-friendly currencies and hurt the safe-haven yen, though worries about the Chinese economy capped gains. Oil prices were also back testing new multi-year highs, a drag on growth in energy-importing markets in north Asia, but good news for energy-exporting markets in Southeast Asia. MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.6%, and Japan’s Nikkei rose 1.08%. U.S. stocks powered ahead overnight after data showed a fall in new claims for unemployment benefits, lower-than-expected factory gate price inflation and forecast-beating results for the four largest U.S. consumer banks. The Dow Jones Industrial Average jumped 1.57%, the S&P 500 climbed 1.46%, and the Nasdaq Composite leapt 1.68%, though analysts said Asia looked unlikely to match these rises. “(US gains) will boost sentiment in pockets, but what we’ve seen in Asian markets recently, especially mainland China and Hong Kong shares, is regional concerns have overridden some of the more positive sentiment that comes out of U.S. markets,” said Kyle Rodda, an analyst at IG markets. “My sense is that things are going to remain fairly mixed and volatile in Asian markets.” Chinese blue chips dropped soon after the bell, but were last flat, while Hong Kong shares returned from a one-day break to open higher before retreating also to be flat. U.S. stock futures, the S&P 500 e-minis, gained 0.15%. A data dump from China due Monday is high on investors’ minds, with the world’s second-largest economy due to report third-quarter GDP figures as well as monthly investment and activity figures. “We expect GDP growth to slow to 4.6% year-on-year in the third quarter from 5.6% previously, in view of persistent weakness in consumption and services amid repeated COVID outbreaks, and the fading of the low year-earlier base,” said Barclays analysts in a note. On Thursday, China’s September factory-gate inflation rose to a record on soaring commodity prices, but weak demand capped consumer inflation, leaving policymakers to walk a tight rope between supporting the economy and further stoking producer prices. In currency markets, the dollar rose again to a near-three- year high on the yen on Friday with one dollar buying 113.89 yen, the most since December 2018. The dollar index, which measures the greenback against a basket of currencies, was marginally lower on the day, at 94.00 and set for its first weekly decline versus major peers since the start of last month, having lost a little ground on sterling and the euro. The yield on benchmark 10-year Treasury notes was 1.5247%, little changed on the day, after trending downwards this week from Tuesday’s four-month high of 1.631%. The Australian dollar took a breather on Friday near its month-high hit a day earlier, which CBA analysts said was due to the weaker dollar and firm commodity prices. U.S. crude gained 0.63% to $81.82 a barrel, back near Monday’s seven-year high of $82.18. Brent crude rose 0.58% to $84.50 per barrel, approaching a three-year high hit Monday. [O/R] Bitcoin is also testing multi-month highs, trading around $57,100 after touching a five-month high of $58,550 on Thursday, with bitcoin bulls talking up the chance of it surpassing April’s all-time high $64,895.22 in the coming months. Reporting by Alun John; Editing by Muralikumar Anantharaman
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