Asian stocks advance to one-year high

Tokyo - Asian stocks rose to the highest level in a year as a weaker yen buoyed Japanese equities after a strong US jobs report increased risk appetite.

The MSCI Asia Pacific Index climbed 1.4% to 137.59 as of 4:20 p.m. in Hong Kong, heading for its highest close since August 17. Japan’s Topix index gained 2% after nonfarm payrolls climbed by 255 000 last month, exceeding all forecasts in a Bloomberg survey of 89 economists.

The yen slid 0.4% after dropping 0.6% on Friday as demand for haven assets waned. South Korean shares advanced after the nation’s credit rating was increased one level by Standard & Poor’s.

"The lack of clarity because of the US jobs data was one reason why last week’s stock markets were weak" said Masaaki Yamaguchi, a Tokyo-based equity market strategist at Nomura Holdings "Since the results rose above both the 200 000 level and consensus forecasts, I expect markets to react positively."

Asian equities are resuming a rally that halted last week after a fresh round of Japanese fiscal stimulus disappointed investors.

The regional measure has climbed about 22% from a February low, shrugging off the effects of Britain’s vote to leave the European Union, as central banks unleash further monetary easing while data from the labour market to retail sales and industrial production spur confidence in the world’s largest economy.

Still, it’s been a choppy year for Asian stocks. While the Asia-Pacific gauge is up 4.3%, Japan’s Topix has lost 16% in 2016, while a gauge of Shanghai shares has dropped 15%.

Hong Kong’s Hang Seng Index rose 1.6% and a gauge of Chinese stocks listed in the city jumped to the highest close since January 4.

China’s exports remained sluggish last month, signalling tepid global demand, while deteriorating imports raised concern domestic conditions may be weakening anew.

Thailand’s SET Index rallied 1.5% to a 15-month high after the nation’s voters approved a new military-backed constitution in its first ballot in two years.

The outcome means the governing junta is more likely to stick to its current time line of holding elections next year, and was a boost to investor confidence.

India’s S&P BSE Sensex Index added 0.3% Indonesia’s Jakarta Composite Index climbed 0.2% and South Korea’s Kospi index gained 0.7%. Australia’s S&P/ASX 200 Index climbed 0.7%. New Zealand’s S&P/NZX 50 Index and Taiwan’s Taiex was up 0.6%.

Futures on the S&P 500 Index increased 0.2%. The US equity benchmark index rose 0.9% on Friday, while the Nasdaq Composite Index advanced to a record.

The US jobless rate held at 4.9% as many of the people streaming into the labour force found jobs. Odds on the Federal Reserve raising rates by the end of this year rose to 47% after the jobs report, up about 10 percentage points from Thursday.