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Asian stocks mixed, link launch lifts Hong Kong

Hong Kong - Asian markets were mixed on Monday as Japanese shares succumbed to profit-taking following last week's huge gains, while Hong Kong and Shanghai rallied after a launch date was announced for a trading link between the cities' exchanges.

The dollar retreated from multi-year highs despite another record close on Wall Street that came in response to broadly upbeat jobs data that did little to alter expectations of a US rate hike in mid-2015.

Tokyo slipped 0.51% after ramping up gains of more than 10% in the previous six sessions after the Bank of Japan unveiled fresh monetary easing measures.

Sydney dipped 0.64%, while Hong Kong surged 2.30% and Shanghai added 1.17%. Seoul was up 1.20%.

Dealers in Hong Kong and Shanghai cheered news that the delayed trading link between the two stock exchanges will start on November 17.

The connection - which is expected to allow the equivalent of US$3.8 billion a day in cross-border transactions - had originally been slated for last month, but was put off as pro-democracy protesters shut down sections of Hong Kong.

The link-up is expected to see volumes on both exchanges rise significantly.

However, the euphoria over the announcement was tempered by news that Chinese inflation was unchanged at 1.6% in October, well off the government's target of 3.5% and adding to fears about the strength of the world's number two economy. Data on Saturday also showed growth in exports and imports slowed last month.

In the United States the Dow and S&P 500 ended with a third straight record close after the Labour Department said the economy added 214 000 jobs last month.

While that figure was weaker than the forecast 235 000, the previous two months' job gains were revised upward and the unemployment rate slipped to a six-year low.

The Dow edged up 0.11% and the S&P 500 nudged 0.03% higher, but the Nasdaq eased 0.13%.

The result weighed on the dollar, which slipped from a seven-year high against the yen.

The greenback was at ¥114.36 on Monday, down from ¥114.62 in New York and well off the ¥115.39 yen in Tokyo earlier on Friday.

And the euro bought $1.2458 and ¥142.49 against $1.2456 and ¥142.78 in US trade.

Japan's Nikkei slipped on the strong yen.

"Given that a great deal of the market's gains over the last several days and months have come on the back of a stronger US currency, its weakness naturally invites profit-taking," said Nomura Securities equity market strategist Junichi Wako.

But he added that "a severe selloff is unlikely", partly because the Bank of Japan and government pension funds are known to be buying on the dip.

On oil markets US benchmark West Texas Intermediate for December delivery rose 20 cents to $78.85, while Brent crude for December was up 31c to $83.70.

Gold was at $1 170.60 an ounce, compared with $1 144.92 late on Friday.

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