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Asia markets close modestly higher; Nikkei posts 2.2 pct weekly drop

Major Asian markets closed modestly higher Friday after wavering between gains and losses, although major indexes in Australia and Japan posted weekly losses.

In Japan, the benchmark Nikkei 225 closed up 59.81 points, or 0.36 percent, at 16,545.82 on Friday, posting a weekly decline of 2.21 percent. The Topix added 4.88 points, or 0.38 percent, to 1,295.67.

The Japanese yen briefly strengthened as high as 99.84 against the dollar, before retreating to levels near 100.21 in the afternoon. On Thursday, the yen climbed as high as 99.62 during Asian hours.

But the currency's relative weakness compared with Thursday's session helped support shares of major exporters, with Toyota closing up 2.14 percent, Honda adding 3.53 percent and Mazda gaining 2.32 percent.

Across the Korean Strait, the Kospi closed near flat at 2,056.24, posting a 0.28 percent weekly gain.

In Australia, the benchmark ASX 200 gained 18.86 points, or 0.34 percent, to 5,526.68, with all but one sector finishing up. The energy sub-index was down 0.57 percent. For the week, the index lost nearly 0.1 percent.

In Hong Kong, the Hang Seng index was down 0.22 percent in late-afternoon trading.

Chinese mainland markets closed up, with the Shanghai composite adding 4.61 points, or 0.15 percent, to 3,108.72, while the Shenzhen composite gained 2.47 points, or 0.12 percent, to 2,044.69.

The modestly positive session in Asia followed a higher finish stateside amid rising oil prices. Oil received a boost in sentiment on further news suggesting OPEC and other major exporters could consider a deal to tackle the global oversupply. That sent oil futures climbing more than 2 percent on Thursday.

Symbol
Name
Price
 
Change
%Change
NIKKEI
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HSI
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ASX 200
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SHANGHAI
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KOSPI
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CNBC 100
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"The [overnight] bounce in oil was helped along by further jawboning from the former president of OPEC, Chakib Khelil, who stated that an OPEC supply-freeze deal was on course because its biggest members were already producing at record levels," said Angus Nicholson, a market analyst at spreadbettor IG.

Khelil made his remarks during an interview with Bloomberg Television earlier this week.

During late afternoon in Asia, however, oil prices retreated modestly. U.S. crude futures slipped slightly, down 0.06 percent to $48.19 a barrel, while global benchmark Brent fell 0.49 percent to $50.64.

In the currency market, the dollar climbed against a basket of currencies, trading at 94.411 as of 3:53 p.m. HK/SIN, after earlier slipping to a session low of 94.217. This was compared with levels near 94.468 on Thursday afternoon Asia time.

Kathy Lien, managing director of foreign exchange strategy at BK Asset Management, said investors were not yet convinced of the seriousness of the risk that the Fed might raise rates later this year.

"The market clearly believes that [policymakers] need to see consistently strong data to justify tightening this close to the U.S. Presidential election," she said.

The Korean won weakened sharply against the dollar, trading as low as 1120.60, compared with its last close at 1107.13.

Ascent Xmedia | Getty Images

Major Australian banks initially sold off in early trade after ratings agency Moody's on Friday morning said it revised the rating outlooks of five Australian banks to negative from stable. The banks with revised outlooks include the country's so-called Big Four: ANZ, Commonwealth Bank of Australia (CBA), National Australia Bank (NAB) and Westpac.

But bank shares later mostly recovered, with CBA turning positive, rising 0.45 percent. National Bank of Australia shares also erased early losses of more than 1 percent to close up 0.11 percent.

"The outlook change for Australia's four major banks reflects Moody's expectation of a more challenging operating environment for banks in Australia for the remainder of 2016 and beyond, which could lead to a deterioration in their profit growth and asset quality, as well as increase in their sensitivity to external shocks," said Moody's in a note.

The major banks have been under pressure this year due to rising bad debts related to their exposure to the resources sectors, which have suffered from a global slump in commodity prices.

In company news, shares of Samsung Electronics climbed 2.13 percent, at 1,675,000 won. The smartphone giant's shares hit an all-time closing high on Thursday, giving it a market capitalization of 232 trillion won ($210 billion), as investors cheered the company's turnaround plans.

Shares of Singapore Telecommunications traded down 0.48 percent, after the telco announced on Thursday it would acquire a stake in Thailand's Intouch Holdings and boost its holding in India's Bharti Telecom to take advantage of faster growth in emerging markets.

Analysts said the impact of the acquisition in Thailand will have minimal impact on the company's numbers. CIMB analysts said in a note to clients that they expect Singtel's dividend policy will likely stay unchanged.

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