Asia stocks higher ahead of US jobs report

Associated Press

BANGKOK (AP) — Encouraging retail sales and a better-than-expected jobs report from the U.S. helped boost Asian stock markets Friday ahead of a monthly report on employment in the world's top economy.

Government figures showing the number of Americans seeking unemployment benefits for the first time rose to 367,000 last week. That was seen as good news, since it was fewer than economists had forecast.

Although U.S. retailers reported slower sales growth in September, analysts said the results are an encouraging sign as a bigger slowdown is usually experienced in that month. September sales rose 3.9 percent — a slowdown from the 6 percent rise in August, an industry trade group said Thursday.

Japan's Nikkei 225 index was 0.2 percent higher to 8,844.93 after the Bank of Japan announced no change in the country's key interest rate following a two-day policy meeting.

South Korea's Kospi gained 0.2 percent to 1,995.98 and Hong Kong's Hang Seng added 0.3 percent to 20,968.09. Benchmarks in Singapore, Indonesia and New Zealand rose. Markets in China are closed for a public holiday.

Despite global economic woes — including a debt crisis in Europe and a growth slowdown in China — stock markets have gained ground, thanks in part to investment optimism fueled by the actions of the U.S. Federal Reserve and other central banks.

The Fed, for example, has undertaken three rounds of bond-buying, known as quantitative easing, to help prop up a faltering U.S. economy. The move injects money into the system that can be lent out and spur growth. Ultralow interest rates are intended to encourage home purchases and reflate the weak U.S. housing market.

But some analysts said having so much money sloshing around the global economy runs the risk of creating asset bubbles and overloading governments with debt that they cannot repay.

"Stock markets in Asia are on a steroid high. Because of quantitative easing, the flood of liquidity is creating asset bubbles," said Francis Lun, managing director of Lyncean Holdings in Hong Kong.

"No one has the ability to really implement meaningful reform, which is really to curb spending on welfare and curb the power of the unions," Lun said. "Those are two fundamental reforms that governments never have the courage to do."

Among Japanese stocks, Toyota Motor Corp. fell 1.8 percent while Nissan Motor Co. lost 1.5 percent. Nikon Corp. slid 4.6 percent.

Hong Kong-listed GOME Electrical Appliances Holding jumped 6 percent. China Shipping Container Lines Co. gained 3.7 percent.

A key event this week comes later Friday when the U.S. Labor Department releases its monthly jobs report — a key indicator of growth in the world's largest economy. Economists forecast that the unemployment rate inched up to 8.2 percent in September from 8.1 percent in August.

Benchmark oil for November delivery was down 42 cents to $91.29 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose $3.57 to finish at $91.71 per barrel on the Nymex on Thursday.

In currencies, the euro fell slightly to $1.3015 from $1.3018 late Thursday in New York. The dollar fell to 78.36 yen from 78.50 yen.

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