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World markets mixed ahead of US jobs report

Youkyung Lee, AP Business Writer

SEOUL, South Korea (AP) -- World stock markets were mixed on Friday as investors treaded cautiously ahead of a U.S. October jobs report. But Asian shares finished on a higher note as investors cheered signs of improvement in China's manufacturing and growing consumer confidence in the U.S.

Britain's FTSE 100 fell 0.2 percent to 5,851. Germany's DAX retreated 0.1 percent to 7,331.13. France's CAC-40 lost 0.2 percent to 3,467.04.

Wall Street appeared set to give up gains, with Dow Jones industrial futures down 0.1 percent to 13,148 and S&P 500 futures shedding 0.1 percent to 1,421.50.

In Asia, markets finished higher. Japan's Nikkei 225 index advanced 1.2 percent to close at 9,051.22. Hong Kong's Hang Seng rose 1.3 percent to 22,111.33 and South Korea's Kospi gained 1.1 percent to 1,918.72. Australia's S&P/ASX200 inched up to 4,460.10. Benchmark indices in Singapore and Taiwan and mainland China also rose.

Asian markets got a boost from upbeat reports from the world's two largest economies that showed a recovery in China's manufacturing sector and growing confidence among American consumers. They fanned hope that the global economy may emerge out of the recent slumber and put itself back on track to recovery early next year.

"Expectations for a turnaround of China's economy and the continued strength of the Asian currencies are driving the inflow of hot money into Asia," Xu Hui, a Seoul-based emerging market analyst at Korea Investment & Securities said. "The rise of Hong Kong dollar might stabilize but investors expect that the Japanese yen will continue its rise."

In Japan, Sony Corp. gained 2.1 percent. The maker of Bravia TVs and PlayStation 3 game machines reported on Thursday after the market closed a smaller loss for the fiscal second quarter over a year earlier on a sales recovery and restructuring efforts. But Sharp Corp., another Japanese electronics maker, sank 2.4 percent after registering a dismal loss in the fiscal first half.

South Korean exporters gained ground with tech heavyweight Samsung Electronics Co. adding 2.3 percent and its smaller rival LG Display Co. up 3.8 percent.

Data from the U.S. Institute for Supply Management on Thursday showed that American factories saw increased orders and more production last month, posting growth for two straight months.

The Conference Board further emboldened investor sentiment after saying that Americans' confidence in the economy surged in October to a nearly five-year high, largely encouraged by an improved job market. Earnings reports from retailers and automakers including Chrysler were also solid.

The data that showed crucial players in the economic recovery are gaining confidence added to the upbeat report that China's economy is improving. China Federation of Logistics and Purchasing's monthly purchasing managers' index showed earlier this week that the world's No. 2 economy saw an improvement in manufacturing last month.

Investors are awaiting the Labor Department's October jobs report, which will be released on Friday morning. Consensus on Factset shows on-farm payrolls rose 121,000 in October after a 114,000 increase in September and unemployment rate at 7.9 percent last month, higher than 7.8 percent in September.

Benchmark oil for December delivery fell 56 cents to $86.56 per barrel in electronic trading on the New York Mercantile Exchange. The contract gained 85 cents Thursday to finish at $87.09 per barrel in New York.

In currencies, the euro fell to $1.2870 from $1.2939. The dollar rose to 80.25 yen from 80.18 yen.