A bounce in the U.S. dollar lifted some Asian stock markets on Friday, while crude oil sank further from its recent $120 a barrel record, dragging energy firms down but boosting airline counters.
Data on Thursday showing signs of resilience in the U.S. labor market and weak German business sentiment boosted the dollar, which held its gains in early Asian trade. Signs of of a sound dollar and U.S. economy are good news for Asia's exporters, who count on strong demand for their products, and for investors, who have been nervously watching for any fresh omens of the U.S. economy slowing further.
Crude oil retreated to under $116 a barrel, as the stronger dollar ignited a selloff and investors shifted cash to equities, but concerns over supply disruptions limited losses.
Airline shares such as Hong Kong's Cathay Pacific, Singapore's SIA and South Korea's Korean Air Lines rebounded after crude oil receded further from its recent record high, but stocks in general are benefiting from a solid performance on Wall Street. The Dow Jones Industrial Average rose 0.67 percent on Thursday to end at 12,848.95 its highest close since early January.
The Nikkei 225 Average rose 2.4 percent to hit a two-month closing high, propelled up as Canon and other exporters gained as the yen retreated, while Japanese government bond futures plunged. Banks such as Mizuho Financial Group surged on growing confidence in their New York peers, while a torrent of short-covering helped lift the overall market.