Market update: Japanese stocks continue to party; other markets await the US payrolls number

US stocks moved higher on Thursday recharged by the surprisingly aggressive monetary stance of the Bank of Japan (BoJ) as it tries to jump-start its economy. While early trading was mixed in the equity markets, a rebound in financials and materials helped indices rise. However, a disappointing jobless claims report later in the day capped the gains (Dow Jones and S&P 500 +0.4%, Nasdaq +0.2%). Weekly jobless claims unexpectedly jumped to a four month high, once again raising concerns over the strength of the economic recovery. Friday’s non-farm payrolls report for March will now be watched even more closely.

Overnight, Japanese markets basked in the sunshine of the BoJ’s largesse. The Nikkei 225 continued its rally closing up 1.6% as exporters reaped the benefit of a weaker yen, which fell to a new three-and-a-half year low of 97.21 against the US dollar. Yields also dropped sharply (prices rose) on long-dated Japanese government bonds. Elsewhere in Asia, Hong Kong shares suffered as airlines fell on worries over bird flu in China (Hang Seng  2.6%), while geopolitical developments hurt South Korean shares (Kospi Composite  1.6%). European stocks were subdued early this morning ahead of the important US data today; at the time of writing the FTSE Eurofirst 300 was down 0.3% and the FTSE 100 down 0.6%.