Asian Shares Mostly Higher; Gold Miners Leading The Way

SINGAPORE -- Asian stock markets were mostly higher Friday, inspired by Wall Street's gains. Mining stocks were rising in Australia and Japan, on gains in gold and base metal prices.

Japan's Nikkei 225 was up 0.1%, Australia's S&P/ASX 200 was up 0.8% and New Zealand's NZX-50 0.5% higher, tracking the Dow Jones Industrial Average's 0.7% rise on Thursday. South Korea's Kospi Composite though was off 0.3% on selling in technology and auto stocks. DJIA futures were five points higher in screen trade.

Still, caution was the watchword in markets, as traders looked to whether the Chinese stock market could build on Thursday's sharp gains. There were also monthly U.S. nonfarm payrolls data on the slate later.

"We know the recent volatile moves in the China stock market were not caused (so much) by economic concerns, so media reports that Beijing will (now) act to support the markets are positive," said Kim Seung-han at HI Investment & Securities in Seoul.

Resources stocks were higher after a surge in gold and base metal prices on Thursday, when spot gold came within a whisker of the key psychological $1,000 per troy ounce level. It was last up $1.15 from New York at $991.25.

In Australia, gold miner Newcrest Mining was up 2.9%, and Lihir Gold up 1.0%, while BHP Billiton rose 0.7%. In Japan, Sumitomo Metal Mining was up 2.7% and Mitsubishi Materials was up 2.9%.

Overall gains in the Japanese market were muted, though. "The Japanese market won't move much unless Wall Street, Shanghai and dollar/yen are all pointing in one direction," said Mizuho Securities market analyst Yukio Takahashi.

Daiwa Securities Group was down 4.6% and Sumitomo Mitsui Financial Group slipped 0.8% after a person close to the matter told Newswires that the two are in final talks to dissolve their partnership in Daiwa Securities SMBC.

Sumitomo Mitsui Financial Group said it was in talks with Daiwa but nothing had been decided regarding dissolving its joint venture.

Korean investors were shrugging off news that North Korea had entered the final phase of uranium enrichment for nuclear weapons and was building more bombs with spent reactor fuel rods. "I don't think people will be scared of such news as many think the possibility that North Korea can actually uses those bombs to attack is low," said Kim at HI Investment & Securities.

Daewoo Securities was up 1.3% while Daelim Industrial rose 1.0% on news of a KRW762.86 billion order to build a gas processing plant in Iran. Hyundai Motor though was down 2.8% and Hynix lost 3.9%.

In New Zealand, NZ Farming Systems Uruguay rose 6.3% on speculation that Singapore-based Olam International, which this week took at 14.4% stake in the company, may buy more and trigger a full takeover offer. Fletcher Building rose 2.1%, and Pumpkin Patch was up 1.1%, tracking their U.S. peers.

In currency markets, the major foreign exchange pairs were keeping to very tight ranges as traders pulled to the sidelines ahead of the U.S. payrolls at 1230 GMT. A Dow Jones Newswires poll of analysts tipped payrolls to drop by 233,000 in August, after a 247,000 fall in July.

The euro was little changed against the U.S. dollar, at $1.4255, from $1.4252 in New York Thursday, and at Y132.03, from Y132.00. The U.S. dollar was at Y92.62 from Y92.75.

Base metals were extending their gains from Thursday with LME three-month copper at $6,310 per ton, up $70 from the London kerb, and aluminum at $1,855, up $2. Lead was also strong given capacity shutdowns on lead poisoning concerns in China, with LME lead at $2,315 per ton, up $45.

Japanese government bonds were weighed by weakness in U.S. Treasurys Thursday and stronger stocks. The lead September futures contract was down 0.12 at 139.24 points and the 10-year yield up one basis point at 1.31%.