* U.S. initial jobless claims raise hopes ahead of payrolls
* Asian shares extend bounce on Thursday
* Euro near one-week high after ECB postpones any policy
* Stabilising emerging market currencies soothe market
* European shares seen rising 0.1-0.2 pct
By Hideyuki Sano
TOKYO, Feb 7 Asian shares regained a measure of
stability on Friday, stepping further away from five-month lows
after a strong rally on Wall Street and hopeful signs the
upcoming U.S. payroll report could put some global growth
concerns to rest.
MSCI's broadest index of Asia-Pacific shares outside Japan
rose 0.8 percent, a day after the index posted
its biggest gains in over two months. The index bounced 2.2
percent from a five-month low hit on Wednesday.
Japan's Nikkei also rose 2.2 percent on the day,
extending its rebound from a four-month low hit earlier in the
week. Mainland China shares were almost flat
from a week ago after the week-long lunar new year holiday.
European shares are expected to rise, with Britain's FTSE
seen rising 0.2 percent and Germany's DAX up
A drop in applications for U.S. unemployment insurance and
strong earnings helped Wall Street shares post their best day of
the year on Thursday while European shares also jumped.
Initial claims for U.S. state unemployment benefits declined
20,000 last week to a seasonally adjusted 331,000, below
economists' median forecast of 335,000.
While the data has no direct bearing on January's employment
report, as it falls outside the survey period, it buoyed the
mood after the recent rout in emerging economies raised fresh
concerns about the global growth outlook.
"Risk sentiment will recover when the market can be assured
that the Chinese economy is doing all right and that U.S.
economic growth is firm," said Tomoaki Shishido, fixed income
analyst at Nomura Securities.
For many investors who have been expecting the developed
economies, especially the United States, to lead the global
economy this year, solid evidence of strong U.S. job growth is
vital to maintain conviction.
More so after a surprisingly downbeat report for December
raised concerns U.S. growth may not be solid as some investors
had hoped. Economists expect a payroll increase of 185,000 in
"The non-farm payrolls report is always an important release
for the U.S. dollar but this month in particular, it could make
or break the greenback," Kathy Lien, managing director at BK
Asset Management, said in a note to clients.
Relative calm in vulnerable emerging markets over recent
days also helped to ease worries some emerging economies might
suffer harsh downturns if capital flight continues.
Battered currencies such as the Turkish lira and the
South African rand are trading off their recent lows.
"Compared to the Latin American crisis or the Russian crisis
in 1990s, most countries have large forex reserves. So I do not
think we will see a major crisis this time," said Tetsuro Ii,
the president of Commons Asset Management.
The euro held near a one-week high against the dollar after
European Central Bank President Mario Draghi said on Thursday
that the euro zone was not plagued by deflation.
He did, however, caution that the currency bloc's economy
remained skewed to the downside and put markets on alert for a
possible rate move in March, acknowledging that emerging-market
turbulence could hit the euro zone.
The euro traded at $1.3592, having risen as high as
$1.3619 on Thursday, its highest level in a week.
Improved risk appetite prompted the yen to step back further
from a 10-week high hit earlier in the week when concerns over
emerging markets were heightened.
The dollar traded at 102.00 yen, off a low of 100.755
yen marked on Tuesday.
Elsewhere, London copper gained 0.3 percent after a
big gain the previous day, on optimism on the global economy.