Rising expectations that the US Federal Reserve and other central banks are close to cutting interest rates helped lift Asian stocks on Friday.
Traders welcomed the latest U.S. data showing the labor market is starting to soften, giving central banks more room to ease monetary policy, tracking gains in New York as well as records in London and Frankfurt.
The better-than-expected figure, which saw unemployment claims rise to the highest level since August, followed last Friday's news that there were far fewer new positions than expected in April.
U.S. Treasury yields, a benchmark for interest rates, fell.
The figures eased concerns that borrowing costs would remain high throughout the year after a series of higher-than-expected inflation rates in the first four months.
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Still, while speculation is mounting that the Fed will cut rates in September, analysts are cautious as decision makers want to see evidence that prices are coming under control.
San Francisco Fed President Mary Daly said that while current policies are keeping the economy in check, “it could take longer” for inflation to fall to the agency's 2% goal. .
“The data is too noisy to say yet that a change in trend has occurred, but the next few weeks will be important. Further rate hikes from here will help the market feel more confident about the Fed's new easing cycle.” “This will encourage investors to factor in the future,'' said National Australia Bank's Rodrigo Catril.
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Earlier on Thursday, the Bank of England left interest rates unchanged at their highest level in 16 years, before hinting that they could be cut in the summer.
Although inflation was slightly higher than expected, Bank of England Governor Andrew Bailey said he was “optimistic that things are moving in the right direction”.
The European Central Bank is expected to cut interest rates in June.
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Positive developments saw London and Frankfurt markets close at record highs.
And Asian investors ended Friday at record highs as Wall Street had a strong day.
Hong Kong continued its impressive rally, entering the bull market by more than 20% from its January lows, while Tokyo, Sydney, Seoul, Singapore, Taipei and Manila also rose.
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However, Shanghai and Wellington won by close margins.
Oil prices widened as investors tracked developments in the Middle East, and Hamas announced Friday that its team negotiating a cease-fire in Gaza in Cairo had withdrawn, saying “the ball is firmly in Israel's hands.'' he added.
Egyptian state broadcaster Al Qahera News reported on Thursday that representatives from both sides departed after two days of negotiations aimed at reaching a ceasefire agreement.
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Tokyo – Nikkei Stock Average: up 0.6% to 38,311.63 (break)
Hong Kong Hang Seng Index: 18,727.56, up 1.0%
Shanghai – Overall: down 0.4% to 3,140.77
Dollar/JPY: rose to 155.73 yen from Thursday's 155.47 yen
EUR/USD: down to $1.0774 from $1.0785 on Wednesday
GBP/USD: down from $1.2524 to $1.2511
EUR/GBP: up from 86.09 pence to 86.11
West Texas Intermediate: up 0.5% to $79.66 per barrel
Brent crude: up 0.4% to $84 per barrel
New York – Dow: up 0.9% to 39,387.76 (close)
London – FTSE 100: up 0.3% to 8,381.35 (close)
Dan/Kururu