Tokyo leads most Asia markets higher after dollar surge

Japanese shares rallied Friday as the dollar surged against the yen ahead of key US jobs data, while Asian energy firms were mixed following another sharp sell-off in oil.

With (Other OTC: WWTH - news) the Federal Reserve all but certain to hike US interest rates at a much-anticipated meeting next week the non-farm payrolls release later in the day will be pored over for clues on bank policymakers' plans for the rest of the year.

The anticipation sent the dollar bursting past 115 yen on Thursday for the first time since the end of January and it managed to hold on in early Asian business, providing rich picking for Japanese traders buying the country's exporters.

Tokyo's Nikkei ended up 1.5 percent, having broken a four-day losing streak on Thursday.

"Now (Frankfurt: 11N.F - news) the market appears convinced that the Fed will raise the rate, while investors are expecting encouraging US payroll figures," Toshikazu Horiuchi, a broker at IwaiCosmo Securities, told AFP. "All in all, Tokyo market sentiment is positive."

The dollar also extended gains against the struggling pound, while it managed to temper a rally in the euro which got a shot in the arm after European Central Bank boss Mario Draghi offered an upbeat outlook for the eurozone economy.

The ECB upped its growth and inflation forecasts for this year while Draghi signalled it no longer sees an urgent need to undertake any extra support measures, meaning there would be no increase in euros being pumped into the system.

- Euro crisis over? -

"Upgraded inflation forecasts and changed language from the ECB are signs the conversation is changing in Europe," said Greg McKenna, chief market strategist at AxiTrader.

"It was a subtle shift but an important one because even though the ECB president and his governing council keep their guidance... relatively unchanged, their upgraded economic forecasts for the EU show that the worst of the euro crisis looks to be behind the 27-nation bloc."

Hong Kong rose 0.3 percent, Sydney added 0.6 percent and Singapore climbed 0.5 percent but Shanghai slipped 0.1 percent.

Seoul put on 0.3 percent as investors were unmoved by news that President Park Geun-Hye's impeachment had been upheld by a Constitutional Court, making her the country's first head to be sacked in such a way. The country's won currency was up slightly.

Another sharp loss in oil prices Thursday fuelled fresh selling in Asia's energy firms but there were recoveries for some as the day progressed.

Hong Kong-listed CNOOC (HKSE: 0883-OL.HK - news) lost 0.7 percent and PetroChina (HKSE: 0857-OL.HK - news) slipped 1.4 percent while Rio Tinto (Hanover: CRA1.HA - news) lost two percent in Sydney. But Inpex added 1.1 percent in Tokyo and Sydney-listed Woodside Petroleum (Frankfurt: WOP.F - news) was 0.5 percent up.

West Texas Intermediate shed two percent and Brent lost almost as much, having both plunged more than five percent Wednesday on renewed worries about a global supply glut, increased US production and questions about an OPEC-Russia led drive to cut output.

Both main contracts rose about 0.7 percent Friday.

In early European trade London, Paris and Frankfurt each rose 0.3 percent.

- Key figures around 0800 GMT -

Tokyo - Nikkei 225: UP 1.5 percent at 19,604.61 (close)

Hong Kong - Hang Seng: UP 0.3 percent at 23,568.67 (close)

Shanghai - Composite: DOWN 0.1 percent at 3,212.76 (close)

London - FTSE 100: UP 0.3 percent at 7,335.40

Euro/dollar: UP at $1.0595 from $1.0580

Pound/dollar: DOWN at $1.2156 from $1.2174

Dollar/yen: UP at 115.40 yen from 114.95 yen

Oil - West Texas Intermediate: UP 39 cents at $49.67 per barrel

Oil - Brent North Sea: UP 34 cents at $52.53

New York - Dow: FLAT at 20,858.19 (close)

source: AFP