Tokyo Shares Outperform After U.S. Jobs Report, Manila Falls After Storm

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Japanese stocks were higher on Monday, outperforming the rest of Asia, as surprisingly strong U.S. jobs data boosted the dollar against the yen, while shares in Manila struggled after Typhoon Haiyan hit the central Philippines over the weekend.

The world’s largest economy added 204,000 jobs in October, according to data released on Friday, much higher than a forecast of 120,000 new jobs. The fresh sign of strength in the world’s largest economy pushed Wall Street higher on Friday.

In Asia, the moves were more moderate as the strong labor report strengthened concerns that the Federal Reserve could start to roll back its stimulus measures sooner than expected. Recent data from the U.S. led many to forecast that the Fed could hold back until next year before starting to taper its bond-buying program. The latest labor report however, raised expectations for a more imminent move.

Signs of strength in the U.S. economy pushed the dollar 1% higher against the yen on Friday, though the greenback pulled back slightly during early Asian trade after Japan posted a larger-than-expected current account surplus for September. The dollar was last at ¥98.94, compared with ¥99.06 late Friday in New York.

The dollar moved higher against several Asian currencies — such as South Korea’s won and Malaysia’s ringgit. The greenback recently traded at KRW1,066.7, compared with KRW1,064.9 late Friday in Seoul, while the ringgit hit a one-month low against the dollar — last at MYR3.1975 per dollar.

The weaker yen translated into an equally sharp jump in Japanese stocks, as the Nikkei rose 1.1%.

Japanese exporters benefited from the weaker yen, with Tokyo Electron up 2.1% and Advantest Corp. rising 2%.

Shares in Olympus Corp. however, fell 3.3% after the camera maker posted second quarter operating profit that beat guidance, but fell short of several forecasts.

Elsewhere in Asia, market were moderate. Australia’s S&P/ASX 200 fell 0.4% and South Korea’s Kospi was flat.

The Philippines PSE Composite lost 1.8% after the country was hit by a super typhoon over the weekend, where the death toll could run into the thousands.

There was some positive economic data from China over weekend, providing further evidence of a steady recovery from a slowdown earlier in the year as industrial production grew by 10.3% on-year in October. Consumer inflation rose to 3.2% on-year, the highest reading since February.

Meanwhile in China, a major political meeting was under way in Beijing. The so-called Third Plenum will finish on Tuesday, and is expected to result in a roadmap for the new government’s policies over the next decade.

Chinese stocks were also little moved, as the focus was on the plenum. Hong Kong’s Hang Seng Index rose 0.1% and the Shanghai Composite was down 0.2%.

 

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