Asian Stocks Mixed; U.S. Jobs Data Awaited

Thu June 5, 2003 11:16 PM ET By Raju Gopalakrishnan

SINGAPORE (<a href=reuters.com>Reuters) - Asian stock markets were mixed on Friday with some investors locking in profits after strong gains this week and others awaiting U.S. payroll data later in the day for more clues on the economic recovery story.

The euro remained firm against the dollar at about $1.1855 after ticking up in the aftermath of Thursday's widely anticipated half-point interest rate cut by the European Central Bank.

Gold prices slipped after surging on Thursday on the strength of the euro, and oil futures nudged higher on more talk of OPEC supply cuts.

After a week of the best gains seen this year, Asian stock markets sobered ahead of the weekend.

Japan's Nikkei average was up a slight 0.19 percent at midday around its best levels since late February. But markets in Australia, Singapore, Hong Kong and Taiwan were marginally down or flat. South Korea was closed for a holiday.

"Investors are unwinding long positions ahead of the weekend and given that we've been rising almost unchecked since last week," said Toshihiko Matsuno, senior strategist at SMBC Friend Securities in Tokyo.

"Also, the market is worried about data on the U.S. economy coming out later today. It could be quite grim," he said.

JOBS OUTLOOK CLOUDY

The United States is to announce the May jobs report later on Friday and analysts expect unemployment in the month to have risen to 6.1 percent from April's 6.0 percent.

But sizable statistical revisions and uncertainty about how quickly the recent rebound in confidence will induce firms to begin hiring again have left many in the market not knowing what to expect.

On Thursday, the U.S. government said applicants for initial jobless benefits rose last week to 442,000, the highest level in more than a month.

Economists had forecast 420,000 new jobless claims and the weekly figure raised some anxiety before the monthly report.

To offset the gloom, an upbeat sales forecast by Intel Corp offered cheer to technology companies in Asia. Intel is the world's largest semiconductor manufacturer and its forecasts are widely viewed as an indicator of demand in the PC industry.

In its report issued after Wall Street closed on Thursday, Intel narrowed its revenue forecast but said sales of its microprocessors, chipsets and motherboards, which account for more than 80 percent of total revenue and are included in most personal computers, were "trending to the high end of the normal seasonal patterns."

In the currency markets, the dollar crept lower against the yen, but quickly moved back to about 117.90 by 10:45 p.m. EDT Thursday from 117.30 yen as intervention fears resurfaced.

The Australian dollar broke above 67 U.S. cents for the first time since July 1999 after the Reserve Bank of Australia governor said the local currency's rally had not been excessive.

U.S. Treasuries firmed slightly in Asia after slipping overnight ahead of the jobs report. The benchmark 10-year note was last at 102-18/32 for a yield of 3.32 percent, down from 3.34 percent in late New York trade.

Spot gold was weaker as the euro came off its highs, inching down in Asian trade to about $367.05 per ounce from about $368.75 in late New York.

Front-end NYMEX oil futures were eight cents higher at $30.82 per barrel after gaining 69 cents on Thursday, boosted by news that two key OPEC oil ministers will meet their counterpart from nonaligned Mexico.

The talks between Saudi Arabia's Ali al-Naimi, Venezuela's Rafael Ramirez and Mexico's Ernesto Martens will come ahead of next week's OPEC meeting. The three countries were the architects of drastic oil curbs in 1998 and 1999.