TOKYO Asian shares fell on Friday, hurt by a drop in regional technology stocks, although gains in Australia and Japan contained overall losses for equities.
The MSCI's broadest index of Asia-Pacific shares outside Japan slipped 0.7 percent, led by a 1.7 percent slide in the technology sector. A sharp fall in tech-heavy markets such as South Korea and Taiwan contributed to the regional retreat.
Seoul shares tumbled 1.3 percent, weighed by weak profits for automakers, while tech shares continued to falter as Samsung Electronics announced cautious spending plans for the first time since the global financial crisis, following rival Apple Inc's below-estimate results announced earlier in the week.
Apple suppliers extended their declines from Thursday, including Taiwan's Largan Precision, while Samsung shares fell 2.8 percent.
A rise in copper and steady gold prices helped push commodity-reliant Australian shares up 0.4 percent to a fresh 21-month high, marking an eighth straight session of gains.
"The U.S. debt ceiling has been pushed out, Japan is stimulating their economy and Europe seems to have digested their debt crisis. There aren't a lot of negatives at the moment," said Lonsec senior client adviser Michael Heffernan in Melbourne.
Japan's Nikkei stock average also outperformed its Asian peers with a 2 percent surge as the yen hit fresh lows versus the dollar and the euro on expectations Japan will pursue bold policies to beat deflation and stimulate growth.
"Trading on Japan is gaining momentum among foreign investors, centering around the dollar/yen, which has dictated Nikkei's direction," said Tetsuro Ii, the chief executive of Commons Asset Management.
The yen's slide after its brief rebound this week bolstered sentiment for Japanese equities as it lifts earnings prospects for exporters, ahead of the quarterly earnings season set to start next week.
The dollar scaled its highest level since June 2010 to reach 90.695 yen early on Friday and the euro rose to 121.32, its highest since April 2011. Prime Minister Shinzo Abe's new administration has made clear it wants a weaker yen, providing investors a reason to short the currency.
The yen has declined sharply since mid-November on expectations the new government will implement aggressive monetary easing and huge fiscal spending polices to end decades of deflation and return Japan to a sustainable growth path.
More than 80 percent of Japanese firms are in favour of Abe's policy mix, though most also feared Japan would face a debt crisis within a few years, according to a Reuters poll.
"JPY weakness should continue over the coming year driven by an expansion of the Bank of Japan's balance sheet relative to the European Central Bank and the Federal Reserve," said Kit Juckes, FX strategist at Societe Generale in a note. "I don't know how long the USD/JPY is going to pause at around 90, but a move to 100 still seems very likely in the longer run."
Solid data from the United States and Germany after similarly upbeat manufacturing figures from China lifted world equity and commodity markets.
The Standard & Poor's 500 Index briefly topped the symbolic 500 mark for the first time since December 2007 while European shares hit their 2013 peak.
U.S. factory activity grew the most in nearly two years in January while a German business survey showed its private sector expanding at its fastest pace in a year this month.
U.S. crude eased 0.2 percent to $95.78 a barrel and Brent inched down 0.2 percent to $113.11.
London copper rose 0.2 percent to $8,109 a tonne and spot gold steadied around $1,667.64 an ounce.
(Editing by Shri Navaratnam)