"Oil will be front and centre in the Asian session...The real focus in the market is the lack of decline seen in gasoline inventories," explained IG market strategist Angus Nicholson. "Summer driving season in the U.S. will end within the next two months, which is when demand for gasoline is at its highest, and yet gasoline inventories are not declining as expected.
"This is developing into a major concern for the oil market because once the seasonal demand disappears, gasoline inventories could be set to explode in the second half of the year," he added.
In the Japanese market, Yahoo Japan was trading up 0.67 percent. On Thursday, Credit Suisse issued a note starting coverage of the stock at outperform, as it expects positive earnings impacts from the company's e-commerce strategy.
Credit Suisse initiated coverage of Rakuten with a neutral rating, with shares of the company trading 3 percent lower. While Rakuten is positioned for long-term growth, it has some near-term headwinds to earnings growth and increasing competition in the e-commerce market, the note said.
Meanwhile, Japan's May current account surplus stood at at 1.81 trillion yen ($17.96 billion), falling 3.72 percent from a month earlier, Reuters reported. The stronger yen curbed gains from investment overseas, but tourism income hit a record high.
U.S. June non-farm payrolls are due later in the day and investors will watch for signs that May's disappointing headline figure of 38,000 was an anomaly. Friday's data is expected to show a rebound to 175,000 nonfarm payrolls, according to Thomson Reuters - a number that will likely influence the Federal Reserve's easing bias for the rest of the year.
Despite expectations of a strong payroll figure, which would likely strengthen the dollar, funds continued to favor safe havens, such as the yen, amid widespread market jitters in the wake of the U.K. vote to exit the European Union (EU).
"Most economists and investors expect a strong recovery in job growth after last month's hauntingly weak report," said Kathy Lien, managing director of FX strategy at BK Asset Management in a Friday note. "With such a view, we would normally expect the dollar to be trading higher against the yen, but instead of rising, USD/JPY fell for the fifth trading day in a row."
The Japanese yen traded at 100.43 against the dollar on Friday, compared with levels near 103 a week ago.
"While we do not discount USD/JPY breaking below 100 on renewed GBP weakness, we believe the downside will also be limited as long as equities are well behaved. Moreover, USD/JPY has already fallen substantially from above 120 in late January," said Philip Wee, senior currency economist at DBS in a Friday note.
Meanwhile, the British pound traded at $1.2945 after dropping to a 31-year low of $1.2796 on Wednesday amid uncertainty surrounding the Brexit vote.
Wall Street's middling finish overnight may have also weighed sentiment in Asia. The Dow Jones industrial average finished lower by 0.13 percent, the S&P 500 ended nearly flat and the Nasdaq composite finished up 0.36 percent, its sixth positive session in seven days.
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