Asia higher ahead of US jobs but Nikkei bucks trend

Asian stocks were mostly higher on Friday with the exception of Japan but trade was cautious ahead of a crucial U.S. jobs report that could determine if the Federal Reserve reduces its stimulus program later this month.

The Shanghai Composite hit an 11-week closing high, South Korean equities rose to a three-month high and Australia's S&P ASX 200 closed flat. Indian equities meanwhile, hit a new three-week high and closed up 1.53 percent. But Japan's Nikkei bucked the trend to skid 1.4 percent on the yen's strength.

(Read more: Good jobs number expected to bring on Fed taper)

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Spiking US yields

The U.S. 10-year yield briefly rose above 3 percent for the first time in two years on Thursday after weekly jobless claims declined to a near five-year low and growth in the services sector rose to its highest level since December 2005.

(Read more: Pro strategies as 10-year nears 3 percent)

The data came a day before the widely-watched employment report on Friday, almost two weeks before the Fed's September policy-setting meeting.

Nikkei down 1.4%

Japanese equities fell below the key 14,000 level to further retreat from the previous day's one-month high as dollar-yen slipped off the key 100 handle in early trade.

Real-estate developers and construction firms were the index's top losers. Heiwa Real Estate lost over 4 percent, Tokyu Land eased 3 percent while Taisei lost 3.7 percent as doubts surfaced over Tokyo's chances of hosting the 2020 Summer Olympics.

Suntory Beverage & Food rallied 1.3 percent on news that it is in advanced talks to buy GlaxoSmithKline's Lucozade and Ribena drinks for over $1.6 billion.

Tokyo Electric Power fell 2.3 percent after Japan's nuclear regulator criticized the operator of the damaged Fukushima power plant, saying it released misleading data about recent leaks of radioactive water.

Shanghai up 0.8%

China's benchmark index reversed opening losses to end up 0.8 percent, its highest close since June 19, as sentiment rose on hopes of financial reform.

Brokerages increased after Beijing re-opened its bond futures market on Friday, following an 18 year closure. Haitong Securities tacked on 2.2 percent.

(Read more: Yuan now one of world's most tradable currencies)

Shipbuilders rallied after the Securities Times reported that the Shanghai free-trade zone has called for easier rules in shopping firm. China Shipping climbed 8.6 percent.

Sydney flat

Australia's benchmark index reversed losses to close in positive territory but investors continued to exercise caution before Saturday's general elections.

"The Australian election looks to be a foregone conclusion; with most major newspapers calling a coalition victory, and should not affect markets materially. It's the data on Monday that is of most importance with the release of China's CPI, PPI and trade balance numbers," said Evan Lucas, market strategist at IG.

Gold miners weighed on the index after gold traded near the previous day's two-week low. Kingsgate Consolidated tanked 7.5 percent while Newcrest Mining lost 3 percent.

India up 1%

India's benchmark index rose to a new three-week high for a second consecutive session and closed up 1.53 percent on increasing optimism over new central bank governor Raghuram Rajan's new reform measures.

Banks extended their rally with ICICI Bank as the index's top gainer, higher by 5 percent.

(Read more: India and Indonesia: who has it worse?)

Seoul above 1,950

South Korea's benchmark index rose above 1,954 points to hit a new three-month high thanks to sold gains in key blue-chip stocks.

Hyundai Motor rallied 2.6 percent after agreeing on a tentative wage deal with its labor union, which could put an end to a series of strikes that has dogged the auto giant since late August. Kia Motors rallied over 3 percent on the news.

— By's Nyshka Chandran. Follow her on Twitter @NyshkaCNBC