Asian markets were mixed Friday, with South Korea's Kospi shedding 2 percent after the central bank cut rates. Investors across the region are bracing for the December U.S. payrolls data, expected to show sharp job losses and deal another blow to hopes for a speedy recovery this year.
The U.S. probably shed more than half a million jobs last month, bringing job losses in 2008 to a post-war record, boding ill for Asia's struggling exporters who have been starved of demand from developed nations.
Global equities, emerging market currencies and high-grade credit had all benefited in the last month from a steady improvement in investors' risk tolerance. However, grim corporate outlooks, including from the world's top retailer Wal-Mart, and prospects for higher unemployment have curbed appetite for riskier assets
The greenback was little changed against the yen and stronger against the euro . U.S. light crude oil for February delivery climbed above $42 a barrel, up 2 percent, as dealers tried to find a floor, thinking most of the bad news has been priced in.
Japan's Nikkei 225 Average closed about half a percent down, as exporters lost steam after a recent rally and on rekindled worry about the global economy, though trade was cautious throughout the day ahead of key U.S. jobs data.
Seoul shares ended 2 percent lower after the Bank of Korea cut base rates by 50 basis points, a move already factored in by the markets, with technology issues leading falls on profit worries as earnings season approaches.
Australian stocks finished 1.1 percent higher as BHP Billiton and gold miners such as Lihir Gold gained, while trade elsewhere was mixed ahead of U.S. jobs data to be released later on.
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Hong Kong shares fell 0.3 percent due to lingering worries about the global economy ahead of key U.S. jobs data. Energy stocks clawed back some of Thursday's steep losses after oil prices rebounded slightly in Asian trade. Offshore oil producer CNOOC rose 1.1 percent, but Asia's top oil & gas producer PetroChina fell 0.6 percent.
Chinese stocks edged up, with shares in power generators leading on speculation that the sector might be the next to receive financial assistance from the government. Guanxi Guiguan Electric Power advanced after saying it had obtained 30 million yuan in aid from the central government for rebuilding after last May's earthquake in southwest China. But airline shares were weak because of a poor traffic outlook as the economy slows, despite news that the government would also give carriers three-year exemptions from tax on fuel surcharges, which the official Shanghai Securities News said would save them some 2.5 billion yuan.
Singapore's Straits Times Index 1.2 percent amidst merger and acquisition buzz. Shares of Chartered Semiconductor rose 3.3 percent after gaining as much as 43 percent Thursday, on rumors that it could be a buyout target of its bigger Taiwanese rivals. But the firm said it was unaware of information that would cause a sharp rise in its share price.