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Asian indexes hit multi-year highs as stocks climb on global optimism

  • Asian markets gained on Friday, tracking the move higher on Wall Street
  • The Nikkei 225 touched a 26-year high and the Hang Seng Index hit a fresh 10-year high in the session
  • South Korea's Kospi saw gains steepen following news that the North had agreed to meet for talks on January 9
  • U.S. stocks had been supported by better-than-expected private sector hiring data
  • The dollar was a touch firmer after sliding in the last session

Asian markets closed higher on Friday, tracking stateside gains after the Dow Jones industrial average hit a major milestone. Markets in the region traded at or around multi-year highs, with Japan's benchmark index touching a 26-year high and the Hang Seng Index earlier hitting a fresh decade-high.

Japan's benchmark Nikkei 225 index tacked on 0.89 percent, or 208.2 points, to close at 23,714.53. The index rose to its highest levels in 26 years as the dollar firmed against the yen. The rally saw most sectors, including automakers and financials, in positive territory.

Blue chips were largely higher on the day. Toyota advanced 1.88 percent and Sony jumped 3.5 percent by the end of the day, although SoftBank Group closed down 0.66 percent.

Symbol
Name
Price
 
Change
%Change
NIKKEI
---
HSI
---
ASX 200
---
SHANGHAI
---
KOSPI
---
CNBC 100
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Across the Korean Strait, the Kospi rose 1.26 percent to end at 2,497.52, with automakers gaining after closing lower in the last session. Tech blue chips also drove gains on the index. Hyundai Motor edged up 1.71 percent and SK Hynix rose 2.85 percent on Friday.

Samsung Electronics advanced 2.04 percent ahead of the company's fourth-quarter guidance, which is expected next Tuesday.

The moves followed news that North Korea will reportedly meet with South Korea for talks on January 9. The discussion is expected to focus on the upcoming PyeongChang Winter Olympics, an event North Korean leader Kim Jong Un said the North was open to joining.

In Australia, the S&P/ASX 200 rose 0.74 percent at 6,122.3 as the telecommunications, financials and materials sectors rose. Major mining companies Rio Tinto and BHP closed up 0.51 percent and 0.82 percent, respectively. Among gold producers, Evolution Mining advanced 1.55 percent by the end of the day.

The New Year rally seen in China markets largely continued on the last trading day of week. On the mainland, the Shanghai Composite edged up 0.2 percent to close at 3,392.36 and the Shenzhen Composite closed 0.04 percent higher at 1,941.8.

The gains were seen after positive China data releases during the week that showed manufacturing and services sector activity in December came in better than expected.

The Hang Seng Index, last year's top-performing Asian major, slipped below the flat line after trading higher for most of the session. At 3:30 p.m. HK/SIN, the index was off by 0.04 percent. Still, the benchmark traded at 30,725.3, within sight of its all-time high of 31,958.41 set in 2007.

Property developers were mostly higher at 3:37 p.m. HK/SIN, with Sunac climbing 4.92 percent and China Evergrande rising 1.96 percent. Technology names, however, were in negative territory, with heavyweight Tencent shedding 0.32 percent ahead of the market close.

Major U.S. indexes climbed higher for the third straight session on Thursday, with the Dow advancing 0.61 percent and closing above the 25,000 barrier for the first time. The move higher also marked the quickest 1,000-point gain in the index's history.

Gains in stocks came amid a wave of positive releases on Thursday. In particular, private sector hiring rose more than expected in December: The monthly report showed 250,000 jobs were added last month, compared to the 190,000 forecast in a Reuters poll.

"Positive economic data releases overnight have helped reinforce the view that the ongoing broad based global economic recovery still has a lot of legs," Rodrigo Catril, senior foreign exchange strategist at National Australia Bank, said in a note.

Dollar ticks up

The positive employment data gave the dollar some support overnight, although the currency later gave up those gains to trade lower in the last session. On Friday, the dollar index, which tracks the greenback against a basket of six currencies, was a touch firmer at 91.936 at 3:23 p.m. HK/SIN, above a low of 91.798 seen on Thursday.

Against the yen, however, the dollar extended overnight gains to trade at 113.05, compared to levels around the 112.3 handle seen at the beginning of the week.

Meanwhile, the euro traded near its highest levels in three years. The common currency fetched $1.2062 at 3:25 p.m. HK/SIN.

On the commodities front, oil slipped after touching levels not seen since 2015 earlier in the week. U.S. West Texas Intermediate was off by 0.31 percent at $61.82 per barrel and Brent crude futures shed 0.26 percent to trade at $67.89.

Corporate news

Singapore's CapitaLand said in a Friday statement it would be divesting its stake in companies holding 20 retail malls in China for 8.37 billion yuan ($1.29 billion). SCP Group, a unit of China Vanke, announced it would be buying those assets, Reuters reported. Shanghai-listed shares of Vanke closed up 4.95 percent. Meanwhile, Vanke's Hong Kong-listed stock rose 5.82 percent and CapitaLand was lower by 0.27 percent at 3:26 p.m. HK/SIN.

Meanwhile, Dalian Wanda Group is looking into potentially listing its sports assets, including a sports marketing agency and events organizer, in Hong Kong, Reuters reported, citing sources. The Chinese conglomerate is also reportedly considering selling some foreign assets, such as yacht manufacturer Sunseeker International.

Canadian asset management company Brookfield Business Partners is reportedly buying Toshiba's nuclear arm, Westinghouse Electric, for $4.6 billion, Reuters said on Thursday. The acquisition will likely close in the third quarter of the year, Reuters added. Westinghouse filed for bankruptcy last year. Toshiba shares closed up 2.17 percent.