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Equities

Nikkei Asia300 Index jumps as US jobs data fuel equity gains

Energy companies advance on crude oil price rally

MUMBAI (NewsRise) -- Asian stocks outside of Japan jumped Monday, as subdued U.S. wage growth eased fears the Federal Reserve may raise its interest rate outlook at its next meeting.

The Nikkei Asia300 Index rose 1.7% to 1,476.76. Energy companies advanced after Brent crude added 3% on Friday, its biggest jump this year. Hong Kong-shares of CNOOC climbed 2.7% and PetroChina added 1.5%. South Korea's SK Innovation advanced 4.9% and Thailand's PTT Exploration and Production rose 1.8%. Singapore's Keppel Corp. gained 1.8% after securing a contract to construct a drilling rig worth about $425 million.

The week's positive beginning for the A300 index came after Friday's data showed that job creation in the world's largest economy remained robust while wage inflation pressures eased. The U.S. economy added 313,000 jobs in February, the most since July 2016, while average hourly earnings rose by 2.6% year-on-year, down from 2.8% in the prior month. The letup in hourly earnings boosted investor sentiments after January data raised concerns that the Fed may raise rates more aggressively than it had planned. The latest data increased the odds that the Fed, at its next week's meeting, would likely maintain its course of hiking rates three times this year.

"The wage inflation certainly tames rate hike expectations for the year," said Jingyi Pan, a market strategist at broker IG Asia. "The upbeat payrolls and underwhelming wage inflation numbers are bringing back the risk-on sentiment."

The dollar index edged lower on Friday and on Monday, while the U.S. long-term bond yields rose. The Fed is expected to raise interest rates by 25 basis points at the next week's policy review.

Wheelock added 0.9% after the Hong Kong-based diversified conglomerate's net profit increased 26% for 2017.

Hong Kong-shares of Chinese conglomerate CITIC advanced 0.4%, underperforming the city's benchmark index. The company said that an estimated impairment of $800 million to $1 billion is likely to be made in the accounts of last year in relation to the value of its Sino Iron project.

India's ITC added 4.1% after the county's Goods and Services Tax Council refrained from changing taxes on cigarettes at its meeting over the weekend.

A slew of Taiwanese companies reported February sales late Friday. Taiwan Semiconductor Manufacturing Co. rose 1.4%, though the index heavyweight had reported a 9.5% decline in February sales. China Steel rose 0.4% after reporting a 3% increase in sales. Innolux declined 0.4% after its sales declined 34%. Asustek Computer and Quanta Computer advanced at least 1.2% each. Both the companies reported a year-on-year decline in February sales.

The Philippines' conglomerate Ayala Corp. added 1.2% after reporting a 16% increase in profit attributable to owners for 2017.

In country indexes complied by Nikkei, China rose 2.3%, Hong Kong added 2%, and India climbed 1.9%. South Korea gained 0.9% and Taiwan rose 1.4%.

The Nikkei Asia300 ASEAN Index of Southeast Asian companies advanced 1.3%.

--Nimesh Vora

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