Friday, February 9, 2007 (1:41 AM ET)
GLOBAL MARKETS-Asian stocks hit record as yen slips, oil climbs (Reuters)
By Kim Coghill
SINGAPORE, Feb 9 (Reuters) - Asian stocks raced to a record high on Friday as a weaker yen boosted Japanese exporters such as Canon Inc. <7751> and a spike in oil prices pushed energy shares higher.
MSCI's measure of Asia-Pacific stocks <MSCIAP> rose 0.8 percent to an all-time high of 143.92 points, eclipsing its previous record of 143.72 set in May 2006.
U.S. crude futures <CLc1> climbed 41 cents, extending a $2 overnight gain on signs of falling exports from producer group OPEC and rising tension between the United States and Iran over Tehran's nuclear programme.
Britain's FTSE 100 <FTSE> index was seen opening 21 to 24 points higher, according to financial bookmakers, recouping losses from the previous session.
Tokyo's Nikkei average <N225> ended 1.2 percent higher as the yen edged closer to a four-year low against the dollar and a record low against the euro.
A weaker currency boosts the value of overseas sales for exporters such as camera maker Canon, which rose 3.6 percent, and Honda Motor Co. Ltd. <7267>, which climbed 3.2 percent.
Shipping firms, which had floundered in the previous session on earnings worries, were back in demand as investors sought companies offering high dividend yields.
Kawasaki Kisen Kaisha Ltd. <9107>, Japan's third-largest shipper, surged 10.7 percent after raising its profit outlook, recovering from a decline of 4.2 percent in the previous session.
Higher oil prices boosted most energy shares across the region. Japan's INPEX Holdings <1605> rose 3.6 percent while Australian-based oil and gas producers Santos Ltd. <STO> and Woodside Petroleum Ltd. <WPL> gained 4.2 percent and 0.8 percent, respectively.
Fueled by strength in energy and mining plays, Australian stocks <AXJO> resumed their record-setting run, rising 0.5 percent.
South Korean shares <KS11> rose 0.3 percent with top lender Kookmin Bank <060000> surging 3.2 percent to a more than six-month high after announcing a surprise dividend increase.
Hong Kong was the only major market in the region to buck the trend, with investors still rattled by a warning from global lender HSBC Holdings Plc <0005> on Thursday. HSBC said defaults were rising in its U.S. mortgage business.
The benchmark Hang Seng <HSI> fell 0.3 percent. HSBC was down 0.6 percent after sliding 2 percent in the previous session.
The warning sparked selling in U.S. markets where investors were already worried about a housing market slowdown. The Dow Jones industrial average <DJI> fell 0.2 percent and the tech-heavy Nasdaq Composite Index <IXIC> slipped 0.1 percent.
YEN FADES
The low-yielding yen continued its slow slide ahead of the start of a Group of Seven (G7) finance ministers' meeting later in the day that is not expected to seriously tackle the issue of the Japanese currency's prolonged weakness.
The dollar was at 121.34 yen <JPY> by mid-afternoon, inching towards a four-year high of 122.20 yen hit last week.
The euro was at 158.25 <EURJPY>, edging closer to a record high of 158.62 yen touched last month. The single currency <EUR> was at $1.3044, little changed on the day.
The euro drew support on Thursday after European Central Bank President Jean-Claude Trichet signalled that interest rates could rise in March and possibly later on in the year. Earlier in the day, the ECB left rates unchanged.
U.S. crude oil futures rose 0.7 percent to $60.14 a barrel. In addition to the OPEC cuts, prices were supported by news that Occidental Petroleum <OXY> was unable to meet supply contracts from a fire-stricken oilfield in California.
Gold briefly topped $660 an ounce but struggled to hold the gains as dealers turned their attention to the G7 meeting. Gold prices often fluctuate along with major currency levels.
Spot gold <XAU> hit an intraday high of $661.30 an ounce before slipping to $659.