Asian stocks higher on Brexit reprieve but trade concerns limit gains

MSCI's broadest index of Asia-Pacific shares outside Japan dropped 1.3 percent, with Australian shares slipping as much as 0.7 percent to two-year lows. Japan's Nikkei shed 1.7 percent to fresh nine-month lows. China's benchmark Shanghai Composite and the blue-chip CSI 300 fell 0.8 percent and 0.9 percent, respectively, while Hong Kong's Hang Seng was off 0.7 percent.

TOKYO: Asian stocks made modest gains on Friday, tracking improved global sentiment after UK lawmakers voted to delay Brexit and as a weaker yen supported Japanese shares, but a fresh flare up in U.S.-China trade concerns is expected to cap gains.

MSCI broadest index of Asia-Pacific shares outside Japan inched up 0.06 percent.

Japan's Nikkei climbed 0.9 percent and South Korea's KOSPI rose 0.45 percent.

Global markets drew some relief overnight with European stocks rising to a five-month high, boosted by strength in the banking sector after Britain's parliament voted to reject a disorderly Brexit. [.EU]

But the S&P 500 dipped 0.1 percent, snapping a three-day winning run, and the Nasdaq shed 0.2 percent on Thursday in the wake of uncertainty over when a U.S.-China trade deal would be reached. [.N]

A summit to seal a trade deal between U.S. President Donald Trump and Chinese President Xi Jinping will not happen at the end of March as previously discussed because more work is needed in negotiations, U.S. Treasury Secretary Steven Mnuchin said on Thursday.

"Initial expectations were for the trade talks to wrap up in March. So any delay causes the markets to automatically assume that the negotiations are not going well, and this is a negative factor for equities," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management in Tokyo.

In the currency market, the pound was 0.1 percent higher at $1.3256, trimming some of the heavy losses suffered overnight.

Sterling retreated 0.75 percent on Thursday as investors geared up for British Prime Minister Theresa May to try again to win approval for her Brexit deal. [GBP/]

British lawmakers voted on Thursday to seek a delay in Britain's exit from the European Union, setting the stage for Prime Minister May to renew efforts to get her divorce deal approved by parliament next week.

The dollar held gains having snapped its four-day losing streak to a group of six major peers.

The dollar index was little changed at 96.717 after rising 0.25 percent on Thursday to bounce back from a nine-day trough of 96.385.

The greenback rose as U.S. Treasury yields climbed from two-month lows marked earlier in the week, driven by corporate supply. [US/]

The dollar was steady at 111.76 yen after climbing 0.5 percent the previous day.

The yen traded in a narrow range ahead of the Bank of Japan's policy decision due later on Friday, with the central bank widely expected to keep interest rates unchanged.

The euro edged up 0.05 percent to $1.1309 after slipping 0.2 percent overnight.

U.S. crude oil futures declined 0.1 percent to $58.54 per barrel, losing some steam after a recent surge but holding close to a four-month peak of $58.74 brushed on Thursday.

Oil prices soared to the four-month high as investors focused on global production cuts and supply disruptions in Venezuela. - Reuters