China stocks rose on speculation the government will take measures to support the market, while concern the Federal Reserve will raise interest rates weighed on the rest of Asia. Oil rebounded from a 4 1/2-month low.
The MSCI Asia-Pacific Index was little changed at 1:02 p.m. in Tokyo after a week in which it lost 0.8 percent. Standard & Poor’s 500 Index futures rose 0.1 percent. The Shanghai Composite Index climbed 1.9 percent to 3,731.
The Australian dollar strengthened 0.4 percent as the central bank indicated the jobless rate has peaked. The yen headed for a weekly loss as the Bank of Japan held its policy unchanged.
“Investors believe the 3,500 to 3,600 level is where the government wants to hold firmly above so bargain-hunters are beginning to buy again,” said Wu Kan, a Shanghai-based fund manager at JK Life Insurance Co., who is adding to shares that will benefit from reforms in state-owned enterprises.
The Shanghai gauge has followed up a plunge of more than 30 percent with a 6.3 percent rebound since the July low as authorities took unprecedented measures to shore up markets.
US stocks slumped overnight before a payrolls report Friday that may add to evidence the economy is robust enough to embolden the Fed to raise interest rates. Malaysian, Indonesian and Philippine shares extended declines from Thursday.
The rally in China also helped Hong Kong’s Hang Seng index gain 0.9 percent. China Securities Finance Corp., the government agency mandated to buy stocks to bolster the market, is seeking access to an additional 2 trillion yuan ($322 billion), said people with knowledge of the matter.
Malaysia’s stock benchmark slid 0.9 percent, Indonesia’s lost 0.7 percent and that of the Philippines slumped 1 percent, extending losses in emerging-market assets from the previous day. Japan’s Topix rose 0.2 percent, while South Korea’s Kospi index lost 0.2 percent.
There’s “a cautious tone in risk markets ahead of tonight’s non-farm payrolls,” said Matthew Sherwood, Sydney- based head of investment strategy at Perpetual Ltd., which manages about $22 billion. “Increased concern about what a strong report may mean saw equities out of favor.”
Australia’s S&P/ASX 200 Index sank 1.8 percent as Australia & New Zealand Banking Group Ltd. tumbled 6.6 percent after raising A$3 billion ($2.2 billion) in capital to meet tougher regulatory standards.
The Australian dollar rose to 73.74 US cents as the central bank said unemployment will hold steady before declining over 2017. Australian 10-year yields rose 2 basis points to 2.85 percent on Friday on expectations a three-month pause in interest-rate cuts will be extended.
The S&P 500’s 0.8 percent slide on Thursday left it at the lowest level since July 27. The selling came amid data Thursday that showed jobless claims hovering near a four-decade low. A report yesterday on the services industries showed the fastest growth in a decade. Traders are pricing in a 48 percent probability that the Fed will raise rates in September.
The Bloomberg Dollar Spot Index, little changed today, touched the highest intraday level since March after the services data on Wednesday bolstered confidence in the economy. It was at $1.0920 per euro.
The yen was little changed at 124.79 per dollar, heading for a 0.7 percent weekly loss as the BOJ maintained its unprecedented monetary stimulus.
While the Fed will scrutinize hiring data, the global rout in commodities is keeping inflation muted. Longer-term Treasuries led gains on Thursday. The yield on 10-year notes was little changed at 2.23 percent, after falling five basis points the previous day.
Oil rose after falling on Thursday to the lowest level since March in New York when U.S. government data showed crude stockpiles remain more than 90 million barrels above the five- year seasonal average. West Texas Intermediate rose 0.6 percent to $44.92 per barrel.
Gold traded little changed at $1,088.55 an ounce. Prices are 0.6 percent lower this week to head for a seventh straight weekly loss, the longest run since May 2004. Nickel and copper both fell 0.4 percent.
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