Asian Shares Mixed; Markets Waiting For U.S. Payrolls

SINGAPORE -- Asian stock markets were mixed Friday, as traders turned cautious ahead of a key U.S. jobs report. Miners were weighing on the Australian market on weaker base metal prices.

Investors had a negative cue from Wall Street's performance on Thursday, with the Dow Jones Industrial Average slipping 0.3%. That, coupled with uncertainty ahead of U.S. non-farm payrolls data later in the global day, prompted some light profit-taking.

"The (U.S. payrolls) data is one of key indicators that will help investors gauge the pace of the recovery of the U.S. consumer spending. So they want to see if the data quells the recent enthusiasm or helps extend the recent rallies," said Lee Kyoung-min at Woori Investment & Securities in Seoul.

Economists surveyed by Dow Jones Newswires on average expect July non-farm payrolls to have dropped by 275,000 jobs, from a loss of 467,000 jobs in the previous month.

Japan's Nikkei 225 was down 0.2%, Australia's S&P/ASX 200 was down 0.5%, South Korea's Kospi Composite was up 0.3% and New Zealand's NZX-50 was up 0.3%. DJIA futures were about four points lower in screen trade.

In Tokyo, auto stocks were lower on profit-taking after leading the Nikkei higher on Thursday. "The smart move is to take profits now," because carrying positions over the weekend and before U.S. payrolls data is too risky, said Yukio Takahashi, market analyst at Mizuho Securities. "Players won't make any big moves until they see how Wall Street reacts to the unemployment figures," he added.

Toyota was down 1.5%, Honda was down 1.0% while Sumitomo Metal Mining had lost 1.1%.

Australian miners Rio Tinto and BHP Billiton were down 2.1% and 2.3% respectively, while Alumina was 2.5% lower after the rally in base metals prices came to an abrupt halt Thursday, on doubts about the global economic recovery as well as profit-taking and U.S. dollar strength.

"The depth of the current correction in metals suggests that we could see somewhat more selling over the next day or two, but as long as energy and equity markets hold up, we don't see a serious setback in the cards," said MF Global analyst Edward Meir.

In early trade in Asia, LME three-month copper added $20 from Thursday's afternoon kerb at $6,045 per metric ton, recovering a tad of its $174 loss on Thursday. Three-month nickel tumbled $850 to $19,595 per ton, while three-month aluminum fell $79 to $1,990 per ton on Thursday; both were as yet untraded in Asia.

Players were also keeping an eye on the Reserve Bank of Australia's monetary policy statement due later. The central bank was expected to raise its outlook for the economy, but investors were more focussed on the U.S. data.

Korea's Kospi Composite was bolstered by gains in financial and construction stocks, though many investors were sidelined ahead of the U.S. jobs data. KB Financial gained 1.8%, Hyundai Engineering was up 1.1% while Ssangyong Motor was up by its daily limit of 15% after its management and unions reached an agreement on job cuts Thursday, ending a 77-day strike.

The New Zealand market was underpinned by Telecom's 1.8% rise, as it recovered from weakness on Thursday, which was prompted by the entrance of new rival 2degrees in to the mobile market. Stock exchange operator NZX Ltd. was up 3.8% after reporting first-half net profit of NZ$60.8 million, up sharply from NZ$4.97 million a year earlier.

Taiwan's financial markets were closed due to Typhoon Morakot, the first major typhoon of the season.

In foreign exchange markets, the major currencies were treading water, with all eyes on the U.S. non-farm payrolls data due later.

The euro was at $1.4362 from $1.4350 in late New York Thursday, and at Y137.03 from Y136.91. The dollar was at Y95.42 from Y95.44.

Societe Generale's Yuji Saito in Tokyo said that with the start of the Japanese O-bon summer holiday next week, "market participants will probably be unwilling to make big bets."

Japanese government bonds were getting a lift from the weaker stock market with the lead JGB futures contract up 0.06 at 137.61 points in light trade.

Spot gold was 70 cents lower from late New York trade at $961.45 per troy ounce. The lead September Nymex crude futures contract was off 10 cents at $71.84 per barrel.