Asian shares were mixed Friday as traders awaited the latest U.S. jobs report, the strength of which could help determine the timing of the next interest-rate increase.

A sooner-than-expected rate increase in September by the Federal Reserve could pull foreign capital out of emerging markets in Asia, analysts say, though a December rate increase would have already been priced in by investors.

Australia's S&P/ASX 200 was down 0.9%, with the Nikkei Stock Average flat, and Singapore's Straits Times Index falling 0.4%.

In South Korea, the Kospi was up 0.1%, holding steady after the government revised its second-quarter economic growth figure to 3.3% on year, compared with 3.2% earlier.

The news also helped briefly boost the Korean won against the U.S. dollar in early trade, though the U.S. dollar has since recovered losses.

There is wide consensus among analysts that the U.S. central bank will raise rates by a quarter of a percentage point in December, though opinion is divided over a rate increase in September.

Despite two strong jobs readings previously, disappointing economic growth in the first half and turmoil in overseas markets have kept the Fed on hold.

"The Fed had previously stated that the September rate hike would depend on the jobs data," said Alex Wijaya, a senior sales trader at CMC Markets. A strong jobs report on Friday will be critical to the decision of raising rates this month, he said.

More than interest rates, the stability of the U.S. dollar will likely affect trading strategies in Asia, analysts say.

"One of the reasons for the good performance of the Asian markets was the relative stability of the U.S. dollar," said Frank Benzimra, head of Asia equity strategy at Socié té Gé né rale. A rate increase in the U.S. would send the dollar higher, affecting Asian currencies and markets, he said.

Meanwhile, a recovery in crude prices helped energy stocks in the region. Australia's Oil Search recovered to trade 0.1% higher after falling 0.7% in early trade. However, Woodside Petroleum extended losses to trade 2% lower.

In Asian trade, the price of Brent, the global crude-oil benchmark, rose by about 1% to $45.88 a barrel.

Early in Friday's session, the Japanese yen rose against the U.S. dollar, weighing on exports stocks, though the currency later pared some of the gains.

Honda Motor traded 1.1% lower with Sharp down 1.4%. However, Sony bucked the market's weakness to gain 1.8%, lifted by increased confidence over its business prospects.

In Hong Kong, the Hang Seng Index gained 0.5%, adding to Thursday's 0.9% rise, led by conglomerate CK Hutchison Holdings. The stock jumped 3.5% to a five-month high after European regulators on Thursday approved the company's Italian telecommunications joint venture.

Goldman Sachs said the approval was line with its expectations, and has kept the stock, which is controlled by tycoon Li Ka-shing, rated as a "conviction buy."

Ese Erheriene and John Wu contributed to this article.

Write to Kenan Machado at kenan.machado@wsj.com

 

(END) Dow Jones Newswires

September 02, 2016 02:05 ET (06:05 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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