Asia report: Markets finish higher after positive US jobs data

Markets in Asia finished mostly higher on Friday, with traders turning their attention stateside as stronger payroll statistics offset the effect of the US withdrawal from the Paris Accord climate agreement at the behest of Donald Trump.

In Japan, the Nikkei 225 was up 1.6% to close at at 20,177.28, while the yen weakened 0.13% to JPY 111.52 against the greenback.

The session marked the first since August 2015 that the Tokyo benchmark exceeded the 20,000 line.

Carmakers were higher during the session, after positive US sales data for May reflected well on Honda and Nissan - although Toyota failed to meet expectations.

Honda shares finished up 2.63%, while Nissan was ahead 2.71% and Toyota finished 1.72% firmer.

On the mainland, the Shanghai Composite was ahead 0.11% at 3,105.98, while the smaller, technology-centric Shenzhen Composite closed finished up 0.85% at 1,788.60.

The People’s Bank of China set renminbi’s loose peg at CNY 6.8070 to the dollar before the session - higher than the onshore yuan’s previous close of CNY 6.8062.

Beijing had hit a seven month high on Thursday.

China’s central bank allows the onshore yuan to trade 2% above or below its loose peg, while the offshore yuan floats freely.

South Korea’s Kospi was 1.16% firmer at 2,371.72, while the Hang Seng Index in Hong Kong was 0.44% higher at 25,924.05.

Compared to the positive sentiment in Japan, carmakers in Korea were on the back foot after the US data showed weaker sales for them in May.

Hyundai Motor was off 1.51%, while Kia lost 0.88%.

In Hong Kong, gambling stocks were stronger after reports that revenues had risen in the Macau casino sector, despite stronger capital controls and an anti-corruption policy in Beijing.

Gaming revenues in the special administrative region were ahead 24% in May to MOP 22.7bn, leading to a 0.5% improvement in Melco International Development stock, with Sands China adding 1.59% and Wynn Macau improving 1.36%.

In the US, President Trump confirmed overnight that the country would formally withdraw from the Paris agreement, although he still wanted new, ‘fairer’ agreements to be negotiated for the US.

Leaders in Europe responded to the news by releasing a statement that the accord could not be renegotiated away from its aims to ensure global temperatures do not increase more than two degrees Celsius above pre-industrialisation levels.

On the data front, positive private payrolls for May led to an improvement in sentiment for the upcoming nonfarm payrolls, due during the Friday session in the US.

The ADP report showed a 253,000 uptick in jobs during the month, well ahead of forecasts for a rise of 185,000.

Oil prices were weaker still on Friday after serious falls on Tuesday.

Brent crude was last down 2.62% at $49.34 per barrel, while West Texas Intermediate lost 2.61% at $47.13.

In Australia, the S&P/ASX 200 was ahead 0.87% at 5,788.11, led higher by the weighty financials subindex, with major miners also underpinning the benchmark.

Over in New Zealand, the S&P/NZX 50 finished 0.7% higher at 7,499.97, led higher by construction conglomerate Fletcher Building, which added 3.5%.

Local KFC, Pizza Hut, Starbucks and Carl’s Jr operator Restaurant Brands was also stronger, gaining 2% to reach a new record of NZD 6.07.

The company announced a 67% rise in first quarter sales on Thursday, after expansions in Australia, Hawaii, Guam and Saipan.

Both of the down under dollars were stronger on the greenback, with the Aussie last ahead 0.31% to AUD 1.3518 and the Kiwi advancing 0.4% to NZD 1.4109.