Most Asian shares rose on Friday amid gains in oil prices and a surge in major currencies across the region.
Australia’s S&P/ASX 200 XJO, +0.44% gained 0.2%, and Korea’s Kospi SEU, +0.12% rose 0.3%. Japan’s Nikkei Stock Average NIK, -1.48% was down 1.2%.
In China, the Shanghai Composite Index SHCOMP, +1.88% rose 1.3%, and Hong Kong’s Hang Seng Index HSI, +0.68% was up 0.5%.
Stock markets that rallied rebounded on stronger currencies relative to the U.S. dollar. The moves were largely driven by the weakness in the dollar after U.S. central bank officials on Wednesday held steady the benchmark interest rate and slowed the pace of future rate increases.
The weaker U.S. dollar helped send oil prices higher overnight, and those gains were lifting shares of materials and energy shares across Asia on Friday. Oil prices are also rising after OPEC officials suggested they could limit output even if Iran doesn’t cooperate.
The dollar’s weakness, which strengthened the yen, hasn’t helped Japan stocks. An appreciating currency hurts exporters. Japan’s main stock index is on track to post a 1.3% weekly decline, which would be the worst-performing benchmark in Asia this week.
Overnight, the yen hit its strongest level versus the U.S. dollar since October 2014. It last traded at 110.93 per U.S. dollar in early Asian trading hours.
Other currencies in Asia are hovering near multi-month highs against the U.S. dollar. The moves reflect investors’ willingness to take on more risk while the dollar is weak.
On Friday, Chinese authorities guided the yuan stronger to 6.4628 per U.S. dollar, a 0.5% appreciation and the strongest move since mid-December.
The Australian dollar rose to $0.7680 per U.S. dollar, its highest since last July.
The Korean won, Thai baht, Singapore dollar and Malaysian ringgit have also rallied versus the greenback.
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