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Asia stocks firm ahead of U.S. jobs, dollar hits one and half month high v...


´╗┐Asian stocks edged up and the dollar rose to 1-1/2-month highs versus the yen on Friday, ahead of the closely-watched U.S. non-farm payrolls report due later in the day. MSCI's broadest index of Asia-Pacific shares outside Japan added 0.2 percent, taking cues from a modest bounce in Wall Street overnight. Japan's Nikkei climbed 1.5 percent on the back of a weaker yen. Shares in South Korea rose 0.3 percent and the won firmed slightly after the country's Constitutional Court upheld parliament's impeachment of President Park Geun-hye over a graft scandal involving big business."Today's ruling will help remove market uncertainty. Should the liberal party, which emphasizes reform of conglomerates, take power, this will put pressure on heavyweight shares like Samsung Electronics," said Park Jung-Hoon, fund manager at HDC Asset Management in Seoul. Wall Street was marginally higher the day before, underpinned by speculation the widely-anticipated labor market report on Friday would show U.S. payrolls growth in February was far more than economist forecast. The employment figures are drawing particular interest as chances of the Federal Reserve raising interest rates several times this year could improve if the data underlines U.S. economic strength."A robust report could give rise to speculation that the Fed could hike rates not just three but even four times this year, in turn pushing up the dollar and U.S. yields," said Shuji Shirota, head of macro-economics strategy group at HSBC in Tokyo.

"Higher yields could be positive for broader equities, which have drawn support from reflation trades. But some in the market may focus on the potentially negative impact higher yields have on equities, so it is hard to predict the effect of the jobs report."Also of concern to broader risk asset markets was crude oil, where prices fell to more than three-month lows overnight as record U.S. crude inventories fed doubts about the effectiveness of OPEC's recent deal to curb a global glut. With global energy stocks under pressure, MSCI's 46-country All World index declined for a sixth consecutive day on Thursday, after setting an all-time high just over a week ago. U.S. crude rose 0.7 percent to $49.65 a barrel after sliding to $48.59 overnight, the lowest since the end of November. Brent was up 0.7 percent at $52.54 a barrel, although it was still headed for a weekly loss of nearly 6 percent.

In currencies, the dollar rose to 115.370 yen, its highest since Jan. 27, as benchmark U.S. Treasury yields rose to three-month highs on expectations that Friday's jobs report could seal expectations for the Fed to hike rates next week. Cementing views of tighter U.S. policy was also a report on Thursday that showed the number of Americans applying for unemployment benefits rose to 243,000 last week, rebounding from a near 44-year low, but continuing to point to a tightening labor market. The dollar did not fare as well against the euro after the common currency enjoyed a lift the previous day on European Central Bank head Mario Draghi's suggestion on Thursday it was less necessary to prop up the market through ultra-loose monetary policy. German, British and Italian bond yields extended their rise in Asia as the region's investors reacted to Draghi's comments, traders said.

The German 10-year bund yield rose to its highest level since early February. The euro extended its overnight gains and was last up 0.2 percent at $1.0594. The dollar index against a basket of major currencies was up 0.1 percent at 101.920 after losing 0.2 percent overnight. The firmer greenback and the prospect of higher U.S. rates pressured both precious and industrial metals. Spot gold went as low as $1,196.34 an ounce, its weakest since Jan. 31. Three-month copper on the London Metals Exchange was at $5,692 a ton after slipping to a two-month trough of $5,652 the previous day.

Oil prices mark time, set for small weekly rise


´╗┐Oil prices were little changed in early Asian trade on Friday as the market looked for clues on how effectively OPEC production cuts are working to absorb a global supply overhang. Brent crude was up 5 cents, or 0.1 percent, at $51.79 per barrel at 0353 GMT, after closing the previous session down 7 cents, and was on track for a weekly gain of about 0.8 percent. U.S. West Texas Intermediate crude (WTI) was up 10 cents, or 0.2 percent, at $48.85 a barrel and was also set for a small weekly rise. Oil prices fell sharply last week on concerns that production cuts by OPEC and non-OPEC members including Russia are not cutting a supply overhang as quickly as expected in the face of increased U.S. output."Saudi Arabian Energy Minister Khalid Al-Falih continued to express concern about high global inventories," ANZ said in a note. "However, he did reiterate that the market is currently going in the right direction and fundamentals had improved."

If crude inventories remain high, the Organization of Petroleum Exporting Countries (OPEC) could extend its oil output cut deal, the Saudi energy minister said on Thursday."Much talk has been made of OPEC, non-OPEC compliance, but the fact is, that when you dig into the numbers, only Saudi Arabia has been pulling its weight," said Jeffrey Halley, senior market analyst at OANDA brokerage in Singapore.

Official data showed crude inventories in the United States, the world's top oil consumer, fell last week as imports plunged, dropping after nine consecutive increases. Crude stockpiles fell by 237,000 barrels in the week to March 10, beating analyst expectations for an increase of 3.7 million barrels. OPEC and non-OPEC members including Russia reached a landmark agreement last year to cut output by almost 1.8 million barrels per day (bpd) in the first half of 2017.

But OPEC's monthly report showed global oil inventories increased in January to 278 million barrels above the five-year average. In a sign that OPEC's efforts have had little impact, oil shipments to Asia have increased 3 percent since the OPEC supply cut deal was made. Iraq's March oil exports have averaged 3.25 million barrels-per-day in the first 14 days of the month, slightly lower than February's 3.27 million bpd. But the decline was not as much as expected, which could raise doubts over the country's compliance with the OPEC supply cut deal.