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Nikkei climbs, boosted by a weaker yen, but other Asia markets slip

Japanese shares climbed on Monday, boosted by a weaker yen, while other Asian markets struggled after comments from U.S. central bankers on Friday suggested interest rates could be raised sooner than expected.

The benchmark Nikkei 225 gained 376.78 points, or 2.30 percent, to 16,737.49, while the Topix added 25.34 points, or 1.97 percent, to 1,313.24.

Remarks from U.S. Federal Reserve officials on Friday about possible interest rate hikes this year had pushed up the dollar index, which measures the greenback against a basket of currencies, from levels near 94.300 before the gathering in Jackson Hole to around 95.500 afterward. Around 2:35 p.m. HK/SIN, the dollar index traded at 95.558.

Dollar strength also pushed the dollar/yen pair higher, trading at 102.37 on Monday afternoon local time from levels near 100.1 on Friday before the Jackson Hole remarks.

Also weighing on the yen, Bank of Japan Governor Haruhiko Kuroda said on Saturday at Jackson Hole that the central bank would approve further monetary easing without hesitation after the previous week's consumer prices data showed a dip in inflation.

The relatively weaker yen boosted Japan's major exporters, with Toyota closing up 3.99 percent, Honda adding 3.70 percent and Mitsubishi Electric gaining 3.64 percent.

Symbol
Name
Price
 
Change
%Change
NIKKEI
---
HSI
---
ASX 200
---
SHANGHAI
---
KOSPI
---
CNBC 100
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The rest of Asian markets were mostly lower. In South Korea, the Kospi closed down 5.15 points, or 0.25 percent, at 2,032.35. In Hong Kong, the Hang Seng index was lower by 0.38 percent in afternoon trade.

Chinese mainland shares moved little, with the Shanghai composite closing flat at 3,070.34, while the Shenzhen composite closed modestly up 4.05 points, or 0.2 percent, at 2,027.14.

Australia's ASX 200 dropped 46.27 points, or 0.84 percent, to 5,469.20, with the heavily-weighted financials sub-index lower by 0.82 percent, likely amid investor concerns over a possible rate hike stateside.

On Friday, U.S. Fed Chair Janet Yellen delivered a highly-anticipated speech at an economic symposium at Jackson Hole, Wyoming, saying she was optimistic about the U.S. economy, fueling expectations that interest rate hikes were ahead.

In prepared remarks, the Fed chair said the solid performance in the U.S. labor market and outlook for economic activity and inflation had strengthened the case in recent months for an increase in the federal funds rate.

The remarks were a bit stronger than some analysts had expected.

"Yellen's appearance Friday morning at Jackson Hole proved not to be the damp squib that many were expecting," Ray Attrill, global co-head of foreign exchange strategy at the National Australia Bank, said in a Monday morning note.

Kazuhiro Nogi | AFP | Getty Images

Attrill, however, pointed out much of the sustained reaction in the foreign exchange and interest rate markets came "not from her comments directly, but follow up remarks by Fed vice chair Stanley Fischer."

Following Yellen's speech, Fischer told CNBC that the August jobs report, due on September 2, would likely weigh heavily in the Fed's decision, along with other upcoming data.

In the commodities space, oil prices fell on Monday during Asian hours. U.S. crude futures dropped 1.64 percent to $46.86 a barrel, whileBrent declined by 1.48 percent to $49.18.

Energy plays in the region were mixed, with shares of Oil Search down 1.45 percent and Woodside Petroleum off 2.83 percent, while Santos shares added 0.22 percent. Inpex was up 1.83 percent. Hong Kong-listed shares of CNOOC were off 0.52 percent and Petrochina shares fell 0.76 percent.

Gold prices also retreated, dropping from levels near $1,341 an ounce on Friday to levels below $1,323 following Yellen's speech. As of 3:07 p.m. HK/SIN on Monday, spot gold was off 0.27 percent at $1,317.85 an ounce.

Stateside, major indexes closed mixed on Friday, with the Dow Jones industrial average falling 53.01 points, or 0.29 percent, to 18,395.4. The S&P 500 dropped 3.43 points, or 0.16 percent, to 2,169.04 and the Nasdaq closed higher by 6.71 points, or 0.13 percent, at 5,218.92.

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