China Up – Japan Down

Hong Kong shares ended in positive territory on Friday, reversing earlier losses, ahead of the release of US jobs figures later in the day. 

The benchmark Hang Seng Index nudged up 17.53 points to 20,756.98 on turnover of HK$63.44 billion ($8.31 billion). 

Regional dealers had their eyes on the release later Friday of a January US payrolls report, while they also digested a batch of earnings releases that highlighted tough global conditions. 

Chinese shares closed up 0.77 per cent, also shaking off earlier losses, on hopes for strong corporate earnings, dealers said. 

The Shanghai Composite Index, which covers both A and B shares, ended up 17.85 points at 2,330.41 on turnover of 70.2 billion yuan ($11.1 billion). 

But analysts said profit takers may move in next week as they wait further monetary easing. 

“The financial sector, a major driver behind gains over the past two days, may need to take a breather after recent gains,” Jacky Zhang, an analyst at Capital Securities, told Dow Jones Newswires. 

The driving factors today were strong economic data from the US.

The US unemployment figure fell more than forecast meaningless people were recently laid off or lost jobs. This is a positive sign for the US recovery.

Also manufacturing data was strong giving an additional boost.

Federal Reserve Chairman Ben Bernanke tempered confidence by telling Congress he was still concerned about persistently high unemployment, and especially those who have been jobless for long periods, which could make them more unlikely to find work.  Also Federal Reserve member Fisher gave a statement yesterday, emphasizing that the statements of FOMC on long term interest rates, was only a projection with no data to substantiate and that the Fed would do what was necessary at the time and that no one could predict the economy in 2014.

Japan’s Nikkei Stock Average fell 0.5% to 8,831.93, Australia’s S&P/ASX 200 index shed 0.4% to 4,251.20 and South Korea’s Kospi gave up 0.6% to 1,972.34.

Japanese and South Korean shares lost ground Friday, as investors digested a raft of earnings reports and turned cautious ahead of a key U.S. employment report. The never ending Greek scenario still lingers on with contradictory statements but officials yesterday, the markets and investors are totally confused and are waiting for a special meeting of the EU on Monday.

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