Asia Markets

Most Asian markets make cautious gains after Bank of Japan holds policy steady

Key Points
  • Most Asian markets made cautious gains despite the softer lead from Wall Street
  • The Bank of Japan kept its policy steady after a two-day meeting
  • Shares of Takata were suspended from trade on reports the company is due to file for bankruptcy this month

Most Asian bourses closed cautiously higher on Friday after the Bank of Japan kept its policy unchanged and following the declines in tech stocks stateside.

Japan's benchmark index gained 0.56 percent, or 111.44 points, to close at 19,943.26, while South Korea's Kospi erased earlier gains to close down by 0.01 percent, or 0.18 points, at 2,361.83.

The S&P/ASX 200 closed 0.19 percent, or 10.81 points, higher at 5,774.

Hong Kong's was trading 0.24 percent higher at 3:00 p.m. HK/SIN. On the mainland, the shed 0.31 percent, or 9.6217 points, to close at 3,122.8646, and the Shenzhen Composite slipped 0.196 percent, or 3.66 points, at 1,866.0522.

In economic news, the Bank of Japan kept its policy steady after a two-day meeting today, as was widely expected. The BOJ also had a more positive view on private consumption and other economies.

"The Bank of Japan is a bastion of stability. It really is no drama, Kuroda. In terms of the growth outlook, in terms of the inflation outlook, things are fine ... They're improving only gradually so unlike the Federal Reserve, unlike the European Central Bank, there is no need whatsoever to change policy here in Japan," WisdomTree Head of Japan Jesper Koll told CNBC.

'No drama Kuroda'

Meanwhile, air bag manufacturer Takata could file for bankruptcy next week, sources told Reuters. The Japan Exchange Group later announced that shares of the company would be suspended from trade today due to the reports, Reuters said.

Takata is reportedly in the process of working out a deal with Key Safety Systems, an American automotive parts maker, according to Reuters. The company agreed to pay out $1 billion in penalties after pleading guilty to fraud earlier this year following a scandal involving defective air bags.

Shares of tech stocks traded in Seoul closed mostly lower following the softer lead from Wall Street. Samsung Electronics reversed earlier gains to close 0.22 percent down and SK Hynix finished 0.17 percent lower. Internet search company Naver bucked the trend to end 0.79 percent higher.

Line, a subsidiary of Naver traded on the Tokyo Stock Exchange, jumped 2.93 percent to close at 4,045 yen each. Deutsche Bank said in a note that it was maintaining its "Hold" rating for Line after acknowledging the company's plans to re-organize its messaging app to become a "broader mobile platform." While Deutsche Bank noted Line's efforts were "encouraging," near-term trends continue to drag on the company's shares, the note said.

Oil prices edged higher after settling lower overnight for a second straight session, touching nearly six-month lows. Brent crude rose 0.43 percent to trade at $47.12 a barrel. U.S. crude traded 0.25 percent higher at $44.57.

Dollar/yen could be headed to 95

The dollar traded at 97.454 against a basket of six major currencies at 2:56 p.m. HK/SIN after trading as high as 97.557 overnight.

Against the yen, the dollar traded at its highest level in close to two weeks following the Bank of Japan's decision. Dollar/yen last traded at 111.22 in afternoon trade, compared with the levels around 110.8 seen in the previous session.

Moves in the dollar overnight were attributed to statements from the Federal Open Market Committee (FOMC) after it decided to hike interest rates for the second time this year. Weekly jobless claims, which came in below estimates, also contributed.

"Dollar bulls, it seems, were quite happy to belatedly indulge in more emphatic U.S. dollar buying on the pretext of hawkish surprise in the FOMC," Mizuho Senior Economist Vishnu Varathan said in an early morning note.

The British pound traded at $1.2772 after trading as high as $1.2795 overnight. Sterling initially rose after the Bank of England kept its policy unchanged yesterday, but with three out of eight policymakers voting for an increase in interest rates.

In the U.S., stocks closed lower, with big name tech stocks pulling back once more after falling earlier in the week.