HONG KONG Asian shares held onto small gains on Friday thanks to a solid Wall Street session, but were still set for their worst month in two years, as looming US rate hikes dragged on sentiment and sent the safe-haven dollar soaring.
The MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.2 percent on Friday after strong earnings from Facebook parent Meta Platforms drove the Nasdaq 3 percent higher overnight.
The sentiment was still fragile, with Nasdaq futures off around 1 percent in early Asia trade, pressured by disappointing earnings from Amazon after market close.
Friday's gains were minuscule compared to the brutal sell-offs in global stocks in recent weeks. The Asian regional benchmark is headed for a 2 percent decline this week and a 7.3 percent drop for the month, its worst month since March 2020.
The US Treasury yields were trading within their recent ranges, a little shy of their peak last week.
The US session ended at 2.8205 percent, having reached as high as 2.981 percent on April 20. The yield for the two year was 2.6132 percent.
This week has been a volatile one for currencies.
The dollar index, which tracks the dollar against six major peers, was a whisker softer at 103.56, having hit 103.93 on Thursday, its highest level since late 2022.
The index's current monthly gain of 5.2 percent would be its best since 2012.
The rally has been fed by market expectations for 150 basis points of rate hikes in just three Federal Reserve meetings, and the increase in safety-bid for the dollar. The aggressive Fed tightening path, mainly to curtail sky high inflation, far outpaces other central banks.
The dollar's recent gains have been the most significant against the yen, and it has swept past the key psychological 130 yen level on Thursday, setting a new 20 year high. The dollar also scored a five year high on the euro Oil prices remained choppy as traders struggled with the supply issues stemming from the conflict in Ukraine.
Brent crude fell by 0.55 percent to 107.00 per barrel on Friday, but still set for its fourth straight month of gains. The US crude fell 0.6 percent to $104.68.