Investing.com - Asian shares drifted higher on Friday with markets cautious on a possible rate hike by the Federal Reserve next month and keeping an eye on the Brexit campaign for the U.S. to leave the European Union.
The Nikkei 225 rose 0.27%. The Shanghai Composite Index rose 0.17%, while Hong's Hang Seng index was last up 1.09%.
The yuan fell slightly against the U.S. dollar on Friday even though the People's Bank of China set the fixing slightly stronger for the first time in three days at 6.5510 as against 6.5531 previously. The fixing weakened 0.40% from last week.
Overnight, U.S. stocks fell sharply on Thursday, as the Dow Jones Industrial Average extended losses from the previous session while investors digested hawkish indications from the Federal Reserve that it will likely raise interest rates next month if the domestic economy continues to demonstrate signs of improvement.
On Thursday morning, New York Fed president William Dudley noted that it could be appropriate to raise interest rates in June or July if U.S. GDP continues to pick up following a weak first quarter. Speaking at a New York Fed event, Dudley also acknowledged that the Fed should weigh the potential of a U.K. departure from the European Union as it makes its decision.
The Dow lost 91.22 or 0.52% to 17,435.40, while the S&P 500 Composite index fell 7.59 or 0.37% to 2,040.04, as both indices continue to retreat from April highs. The NASDAQ Composite index, meanwhile, dipped 26.59 or 0.56% to 4,712.53 amid a weak session among pharmaceutical stocks.