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Asia: Markets build on gains after Wall St record

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[HONG KONG] Asian markets enjoyed more gains on Friday, putting them on course to end the week with a flourish as investors looked past the China-US trade row to focus on the booming American economy.

The upbeat mood on trading floors was being felt across the board, with embattled emerging market currencies seeing a recovery, while some observers suggested a fear of missing out was also providing some lift.

Regional dealers were given a strong lead from Wall Street, where the Dow and S&P 500 chalked up record closes as easing concerns about Washington and Beijing's tit-for-tat tariffs were mixed with a string of positive US data, including on jobless claims and household net worth.

"Make no mistake, the US economy is running on all cylinders," said Stephen Innes, head of Asia-Pacific trade at Oanda.

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"Robust growth, soaring employment and rising capital investments, suggesting the healthy US economy is more than just a short-term knock-on effect from the intravenous elixir of easy credit and fiscal glucose. The US economy is thriving."

That filtered through to Asia where Tokyo ended the morning 0.5 per cent higher, Hong Kong climbed 0.7 per cent and Sydney gained 0.5 per cent.

Singapore jumped 0.7 per cent, Seoul added 0.3 per cent and Manila surged 1.6 per cent. Taipei and Jakarta were also well up. Shanghai, however, dipped 0.2 per cent.

Emerging market currencies - beaten down in recent weeks by fears of contagion from crises in Turkey, South Africa and Argentina - were also basking in the optimism as traders sought out higher-risk assets.

South Korea's won rose 0.4 per cent, while the Indonesian rupiah and Malaysia's ringgit each added 0.2 per cent. South Africa's rand and the Turkish lira jumped more than one per cent.

China's yuan is also holding its strength after Premier Li Keqiang said this week that Beijing would not devalue the unit to offset the impact of Donald Trump's import tariffs.

The pound and euro were also holding Thursday's gains following strong economic data out of Britain and Europe.

Traders are awaiting next week's Federal Reserve policy meeting, where it is expected to lift interest rates again, while its statement will be pored over for forward guidance regarding further hikes.

On oil markets, both main contracts edged down after being hit Thursday by Mr Trump's tweet calling for Opec to lower prices.

His remarks come as the group prepares to meet in Algiers this weekend with other key producers, with analysts expecting them to discuss the upcoming cut in oil exports from Iran as US nuclear sanctions kick in.

AFP