Asian stocks gained on Friday on upbeat expectations for the closely-watched U.S. jobs data, while the euro continued to flirt with fresh nine-year lows against the dollar.
Equities worldwide suffered deep losses early this week as plunging oil prices and global growth woes triggered investor flight from risk assets. But optimism about the U.S. economy and prospects of more stimulus from the European Central Bank and China have diffused risk aversion for the time being.
Taking heart after Wall Street rallied for the second day on Thursday, MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1 percent. Japan’s Nikkei was up 0.5 percent and Australian shares added 1.4 percent. Hong Kong’s Hang Seng gained 1.2 percent. The S&P 500 has risen a total of 3 percent over the last two sessions, retracing most of its 4.2 percent loss in the previous five trading days.
A strong non-farm reading would strengthen prospects of the Federal Reserve hiking rates later this year and again highlight the contrast in policies between the ECB, now facing euro zone deflation and seen on the brink of adopting quantitative easing.
In currencies, the euro traded at $1.1806, wallowing close to a fresh nine-year low of $1.1754 hit overnight on the back of enhanced expectations that the ECB would embark on fresh easing as early as this month. The dollar was little changed at 119.48 yen, having come back from a three-week low of 118.05 struck on Tuesday when risk aversion favored the safe-haven Japanese currency. U.S. crude oil gained 40 cents to $49.19 a barrel after plumbing a 5-1/2-year low of $46.83 on Wednesday.
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