Update: Oil extends gains, euro recovers on ECB assurances

[HONG KONG] The euro edged lower on Friday after rallying on an ECB assurance that Greek banks will retain access to crucial funds, while oil prices extended gains after a volatile week.

Investors seemed to shrug off a clash between Greece's new finance minister and his German counterpart over renegotiating Athens's debt, and a strong rally on Wall Street provided support to most Asian markets.

While the Greek issue is still in focus, attention Friday will be on the release of US January jobs data, which could give fresh clues about Federal Reserve monetary policy.

Tokyo stocks added 0.82 per cent, or 143.88 points, to close at 17,648.50 and Seoul gained 0.14 per cent, or 2.68 points, to 1,955.52.

Sydney rose for a record 12th straight session, adding 0.16 per cent, or 9.20 points, to close at 5,820.17, despite Australia's central bank lowering its 2015 economic growth forecasts. The index has now risen more than 10 per cent since January 20.

However, Shanghai sank 1.93 per cent, or 60.62 points, to 3,075.91 and Hong Kong slipped 0.35 per cent, or 86.10 points, to 24,679.39.

Oil enjoyed another uptick at the end of a week that has seen prices swing from six-year lows last Friday to highs not seen since the turn of the year.

"Volatility is rampant in oil markets right now," said Jasper Lawler, market analyst at trading group CMC Markets UK.

"Prices are gyrating up and down by five per cent every other day as traders jostle for position."

On Friday the US benchmark, West Texas Intermediate for March delivery, rose US$1.06 to US$51.54 while Brent crude for March gained $1.17 to US$57.74 in afternoon trade.

Crude last week hit lows not seen since March 2009, pressured by a global supply glut and a strong dollar.

This week's rally has been credited to investors bargain-buying the cheaper commodity, while the dollar has also weakened since a batch of disappointing US data.

On Wall Street Thursday, the Dow climbed 1.20 per cent, the S&P 500 rose 1.03 per cent and the Nasdaq advanced 1.03 per cent.

The euro eased Friday, but losses were limited following Thursday's advances that came in response to soothing noises out of the European Central Bank over Greek banks' access to cash.

The single currency bought US$1.1444 and 134.26 yen on Friday afternoon, compared with US$1.1475 and 134.89 yen in New York Thursday.

The dollar was at 117.34 yen against 117.55 yen in US trade.

On Wednesday, the euro tumbled after the eurozone's central bank said Greece's lenders would not be able to use government bonds as collateral to raise funds.

But ECB officials said on Thursday they could still tap its emergency liquidity assistance programme, dampening fears of an immediate banking crisis while Athens seeks new bailout terms with its creditors.

Talks between Greek Finance Minister Yanis Varoufakis and Germany's Wolfgang Schaeuble got off to a frosty start on Thursday when the two clashed over plans by Greece's new anti-austerity government to renegotiate paying back the country's huge debts.

On the latest leg of a European charm offensive to build support for the new government's policies, Mr Varoufakis said he and Mr Schaeuble had not found any common ground, while the German side said it was "sceptical" about the Greek proposals.

Gold fetched US$1,264.34 an ounce on Friday, against US$1,260.30 on Thursday.

In other markets: - Singapore rose 0.73 per cent, or 24.78 points, to close at 3,431.36.

Singapore Airlines dipped 0.25 per cent to S$12.13 and DBS Bank declined 0.21 per cent to S$19.38.

- Kuala Lumpur's main stock index gained 0.56 per cent, or 10.04 points, to close at 1,813.25.

AMMB Holdings added 0.64 per cent to RM6.33, Public Bank rose 1.84 per cent to 18.78 while Sime Darby lost 0.10 per cent to RM9.53.

- Bangkok rose 0.36 per cent, or 5.71 points, to close at 1,613.63.

Airports of Thailand rose 1.27 per cent to 320.00 baht while energy giant PTT gained 0.80 per cent to 377.00 baht.

- Jakarta ended up 1.19 per cent, or 62.62 points, at 5,342.52.

Palm oil firm Astra Agro Lestari gained 7.98 per cent to 26,400 rupiah, while construction company Adhi Karya slipped 0.28 per cent to 3,520 rupiah.

- Mumbai declined 0.46 per cent, or 133.06 points, to end at 28,717.91 points.

Tata Motors fell 5.05 per cent to 559.75 rupees, while Housing Development Finance Corporation rose 2.45 per cent to 1279.50 rupees.

- Taipei fell 0.59 per cent, or 55.87 points, to 9,456.18.

Taiwan Semiconductor Manufacturing Co eased 1.72 per cent to NT$143.0 while smartphone maker HTC rose 0.96 per cent to NT$158.5.

- Manila closed 0.70 per cent, or 53.94 points, higher to 7,728.18.

Universal Robina rose 3.43 per cent to 211 pesos, SM Investments gained 0.61 per cent to 901.50 pesos while Philippine Long Distance Telephone was up 0.06 per cent at 3,092 pesos.

- Wellington was closed for a public holiday.

AFP