Asian Shares Rise, U.S. Jobs Data in Focus

Asian shares shrugged off weak U.S. data overnight that raised concerns ahead of Friday’s key employment figures, and logged gains on Thursday as investors covered positions ahead of the Easter holidays.

European bourses were expected to follow suit, with financial spreadbetters calling Britain’s FTSE 100 .FTSE to open flat to 1 point higher, or up 0.01 percent; Germany’s DAX .GDAXI to open 27 points higher, or up 0.2 percent; and France’s CAC 40 .FCHI to open 12 to 13 points higher, or up 0.3 percent.

“The performance of Europe’s markets, which continue to look fairly well-supported, as well as trading at multi-year highs, stands in contrast to the weakness currently being seen in U.S. markets,” Michael Hewson, chief market analyst at CMC Markets, said in a note.

Most U.S. markets will be closed on Friday, with some European markets closed Friday through Monday and reopening on Tuesday.

MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was up about 0.6 percent, ignoring a weak performance overnight on Wall Street.

Australian shares .AXJO finished up 0.7 percent, on growing expectations that the Reserve Bank of Australia will announce its second rate cut of 2015 when it meets on Tuesday, the first trading day after markets close for the Easter long weekend.

Japan’s Nikkei stock average .N225 ended 1.5 percent higher, after skidding to a three-week low in the previous session.

“Hedge funds are seen covering their short positions as the Nikkei fell sharply this week,” said Norihiro Fujito, senior investment strategist at Mitsubishi UFJ Morgan Stanley Securities.

Friday’s non-farm payrolls are expected to show an increase of 245,000 jobs in March, following a gain of 290,000 in February, according to economists polled by Reuters.

But on Wednesday, the ADP National Employment Report showed that U.S. private employers added 189,000 jobs last month, falling well short of economists’ expectations for a rise of 225,000 jobs. The figure was the weakest since January 2014.

Separate data on Wednesday showed the pace of U.S. manufacturing growth in March slowed to its slowest in nearly two years.

The dollar slumped after the data as it reinforced concerns that the currency’s recent rally has weighed on exports. The data also raised bets the Federal Reserve might not hike interest rates until late 2015.

“Right now the market’s worry is the Fed showing concern about a strong dollar, and the data only compounded such fears,” said Masashi Murata, senior currency strategist at Brown Brothers Harriman in Tokyo.

“Even if Friday’s non-farm payroll number is decent – it could come in around 250,000 – that might not dispel strong dollar concerns. That is why there isn’t much bargain hunting for the dollar,” he said.

The greenback was down about 0.2 percent on the day at 119.57 yen JPY=, while the euro added about 0.2 percent to $1.0787 EUR=.

The euro was bolstered by Wednesday’s data showing manufacturing activity across the euro zone is accelerating.

Oil prices were off their session lows but still down on the day, giving back some of the sharp gains made in the previous session after U.S. crude output fell for the first time in two months and the government announced a smaller-than-feared rise in weekly stockpiles.

U.S. crude futures CLc1 shed about 0.9 percent to $49.66 after surging more than 5 percent on Wednesday. Brent LCOc1 was down 0.6 percent at $56.76 after closing up 3.6 percent. [O/R]

Gold XAU= hovered slightly above $1,200 an ounce, clinging to gains from the prior session when it rose the most in two months on the weak U.S. economic data.

Source: Reuters

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