Markets in Asia finished mixed on Friday, as traders likely huddled on the sidelines before the key U.S. nonfarm payroll report due later in the global day.
In Australia, the benchmark ASX 200 (^AXJO) closed down 42.76 points, or 0.79 percent, at 5,372.80, with most sectors finishing lower. The energy and materials sectors bucked trend to close up 0.18 and 0.35 percent, respectively.
Japan's Nikkei 225 (Nihon Keizai Shinbun: .N225) finished flat at 16,925.68, closing at levels not seen since early June 2016. Across the Korean Strait, the Kospi (Korea Stock Exchange: .KS11) closed up 5.59 points, or 0.28 percent, to 2,038.31. In Hong Kong, the Hang Seng index (Hong Kong Stock Exchange: .HSI) closed up 104.36 points, or 0.45 percent, at 23,266.70.
Chinese mainland markets closed mixed, with the Shanghai (Shanghai Stock Exchange: .SSEC) composite up 4.19 points, or 0.14 percent, at 3,067.49. The Shenzhen (Dow Jones Global Indexes: .DJSZ) composite shed 8.17 points, or 0.40 percent, to 2,009.29.
Traders and investors will be closely eyeing Friday's employment report for clues on when the U.S. Federal Reserve might hike interest rates again. Fed officials have repeatedly said their decision was dependent on economic data and a week ago, Fed Chair Janet Yellen said she was upbeat about the health of the economy.
"Market sentiment is mixed...as traders tend to take less risk ahead of the nonfarm payrolls," said Margaret Yang, a market analyst at CMC Markets Singapore.
The nonfarm payroll report is also one of the last major indicators to be released before the Federal Open Market Committee's September monetary policy meeting.
"If the actual data turns out to be a big miss, enthusiasm on the September rate hike will dampen, and the dollar's rally will probably lapse," Yang said.
In the currency market, the dollar (New York Board of Trade (Futures): =USD) traded at 95.689 against a basket of currencies on Friday afternoon Asia time, compared to levels above 96.00 earlier in the week. The greenback rallied last Friday, after remarks from Yellen and Fed vice chair Stanley Fischer renewed speculations over an imminent rate hike.
On Thursday, the dollar index had finished at 95.653. Some currency strategists attributed the dollar's decline to profit taking.
"Investors took profits on their long dollar positions ahead of Friday's nonfarm payrolls report," explained Kathy Lien, managing director of foreign exchange strategy at BK Asset Management, in a late Thursday note.
"The sell-off was motivated by a weak manufacturing ISM number, but the stakes are high for [Friday's] release and some traders decided it was smarter to reduce exposure."