Asian markets meandered on Friday, despite gains on Wall Street was buoyed by small gains in oil prices.
Japan's Nikkei 225 was up 0.07 per cent after weaving in and out of negative territory. The market may remain directionless as traders await the Bank of Japan's monetary policy decision around midday, with some analysts expecting further easing.
Across the Korean Strait, the Kospi fell by 0.62 per cent. Down Under, the ASX 200 index was flat, with the energy sector gaining 3.05 per cent, while the gold sector fell 5.01 per cent in morning trade.
The Business Times reported that Singapore's Straits Times Index opened slightly higher, edging up by 3.64 points or 0.14 per cent.
Despite the downward trend in Asian equities, some analysts believe equity markets might be reaching a turning point soon.
In a morning brief, Christophe Donay, head of asset allocation and macro research at Pictet Wealth Management, wrote, "Outside of financial crises, the average length of a correction on equity markets is about 50 days-and taking the correction in December as the start of the current period of volatility, the length of this sell-off is now around the average."
Donay added, "Since we do not believe that conditions point to a financial crisis, the magnitude and length of the sell-off suggest that we may well have reached the bottom, and are set for a rebound."
Energy stocks gain across the board
Energy stocks across the region were mostly higher after oil made overnight gains for the third consecutive day. Prices, however, remain at multi-year lows.
Australia's Santos was up 4.59 per cent, while Woodside gained 3.45 per cent. In Japan, Inpex was up by 2.91 per cent, while Japan Petroleum saw gains of 2.89 per cent. South Korea's S-Oil was up 1.97 per cent.
Overnight, US crude was up 92 cents, or 2.85 per cent, at $33.22 a barrel after reaching an intraday peak of $34.82, while global benchmark Brent was up $1.14 at $34.24, down from its intraday high of $35.84.
Despite three successive days of gains in oil, fueled by hopes of reduced production from oil producers in response to the current glut, experts remain divided over whether a deal between Russia and Saudi Arabia will come to fruition.
Both countries have given mixed indications over their willingness to co-operate in recent days.
Evan Lucas, market strategist at spreadbetter IG, dismissed the messages as "jawboning" in his morning note, adding, "The Russian-Saudi talks look to be more about creating price spikes than actual action, and other politics will cause inaction."
"OPEC has shown no willingness to work together and cut production for the past 26 months - its last opportunity to act as one in December ended with production ramping up as forecasted," Lucas wrote. "Russia is one of Tehran's biggest allies - Tehran is looking for an easy re-entry into world oil markets and a high price would offset initial capex issues involved with switching production back on."
Iran's re-entry into the oil market is not in the political or economic interest of Saudi Arabia due to ongoing tension between Tehran and Riyadh over Yemen and Syria, Lucas added.
Mixed economic data from Japan, South Korea
In Japan and South Korea released a slew of data on Friday morning.
Japan's core consumer prices were up 0.1 per cent in December, on-year, according to government data. The core consumer price index, which includes oil products but excludes fresh food prices, was in line with market expectations.
On the other hand, Japan's household spending and factory output for last month both slumped, indicating continued headwinds in the Japanese economy. Household spending dropped 4.4 per cent in the year to December, higher than a market expectation for a 2.4 per cent decline, while factory output for December slid 1.4 per cent, also worse than a market prediction of 0.3 per cent drop.
One of Nikkei's index heavyweights, Fanuc, saw its shares plunge 12.45 per cent in morning trade after reports said the company cut its earnings forecast.
On the upside, Takata shares were up 3.52 per cent, following reports that the company's chief executive, Shigehisa Takada, is willing to resign to take responsibility for air bag recalls. The Wall Street Journal, citing people familiar with the matter, reported that executives from major carmakers including Honda, Toyota, Nissan, BMW, and Volkswagen will attend a meeting with Takata later today to discuss the company's financial conditions and business plans.
South Korea's industrial output for December grew by a seasonally adjusted 1.3 per cent on monthly terms, after a revised 2.1 per cent drop in November. A Reuters survey had predicted the median expectation for December output to grow at a tepid rate of 0.3 per cent.
Australian gold miners take a hit
Australian gold miners were mostly down, with Alacer Gold losing 3.08 per cent and shares of Newcrest falling by 6.27 per cent. Spot gold traded flat at $1,114.81 an ounce.
Elsewhere, resources stocks were mostly positive, with shares of Rio Tinto and BHP Billiton up by 0.80 and 1.79 per cent respectively. Iron ore producer Fortescue was up by 10.53 per cent, while Atlas Iron saw early losses of 3.33 per cent.
Overnight on Wall Street
Major US indexes finished Thursday's trading session in the green, with the Dow Jones industrial average closing up 125.18 points, or 0.79 per cent, at 16,069.64. The S&P 500 was up 10.41 points, or 0.55 per cent, at 1,893.36, while the Nasdaq composite gained 38.51 points, or 0.86 per cent, to 4,506.68.
On the data front, a slew of numbers are due from Japan and South Korea including Japanese consumer price index and South Korea's December retail sales. The Bank of Japan's two-day policy meeting also concludes today.