Asia Stocks Post Best Week in Two Months as Weak Yen Buoys Japan

  • Yen is on course for third week of losses against dollar
  • Indian stocks climb after rupee rebounds from record low

BlackRock's Turnill: How to Play Emerging Markets

Asian stocks headed for the first weekly advance this month as a weaker yen spurred gains in Japanese shares and optimism grew that the U.S. economy will be able to cope with higher borrowing costs.

The MSCI Asia Pacific Index rose 0.7 percent to 135.85 as of 4:10 p.m. in Hong Kong, with commodity producers surging the most this week among industry groups. Japanese shares stretched their rally to levels unseen since the Bank of Japan introduced negative interest rates in January. Chinese stocks traded in Hong Kong had its steepest weekly increase since July and Indian equities erased a weekly loss as the rupee climbed from a record low.

Economic data and the prospect of increased spending under U.S. President-elect Donald Trump have made a Federal Reserve interest-rate next month a near certainty, propelling the greenback to its strongest level in a decade versus major peers. A rout in emerging-market assets faded on Friday as currencies recovered.

“There’s this anticipation of the U.S. raising rates that is a positive signal that the U.S. economy is strong and that’ll keep pushing additional inflows into the dollar,” Niv Dagan, executive director at Peak Asset Management LLC, said by phone from Melbourne.

Japan’s Topix index advanced 0.3 percent, rebounding from afternoon losses to keep alive its longest winning streak since June 2015, as a continuing recovery in automakers overshadowed a sharp drop in bank shares. Tokyo shares found support as the yen traded near its lowest since March. Banks lost 2.9 percent in the wake of a 40-year bond auction that saw better-than-expected demand.

Australia’s S&P/ASX 200 Index rose 0.4 percent to the highest close since August and South Korea’s Kospi index added 0.2 percent. The Hang Seng China Enterprises Index of the nation’s shares traded in Hong Kong climbed to the highest since Oct. 25 as as insurers extended a surge amid bets their investment returns will improve. The measure capped a 4.7 percent advance this week.

Indian shares climbed 1.3 percent, led by metal producers and software exporters and headed for its first weekly gain in five weeks. The rupee rebounded 0.4 percent after it breached the record low set in 2013 on Thursday.

S&P 500 Index futures rose 0.2 percent from Wednesday’s close, with equity markets in the U.S. to close Friday at 1 p.m. local time.

Before it's here, it's on the Bloomberg Terminal.
LEARN MORE