Japanese shares rally, bitcoin shoots for the moon

SYDNEY (Reuters) - Asian shares rallied for a second session on Friday as investors awaited major economic data from China and the United States while marveling at the meteoric ascent of the market’s new crypto-star, bitcoin.

Japan's Nikkei .N225 led the way again with an early gain of 0.9 percent, adding to Thursday's 1.45 percent bounce.

Australian stocks put on 0.4 percent while MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS edged up 0.1 percent.

Bidders were encouraged by a steadier performance on Wall Street, where the Dow .DJI rose 0.29 percent. The S&P 500 .SPX gained 0.29 percent and the Nasdaq .IXIC 0.54 percent.

Facebook (FB.O) climbed 2.3 percent and Google parent Alphabet (GOOGL.O) 1.2 percent, helping the S&P 500 end higher after losing ground for four straight sessions.

Investors in Asia were awaiting November trade numbers from China to gauge the pulse of global growth and the Asian giant’s demand for commodities.

The main event later will be U.S. non-farm payrolls, with investors looking for 200,000 new jobs in November and much talk wages might show some welcome strength.

Also on the radar are negotiations between the United Kingdom and Ireland on how to run their post-Brexit land border, where a deal could remove the last obstacle to opening free-trade talks with the European Union.

Speculation about an agreement saw sterling rebound sharply overnight to reach $1.3474 GBP=, having been as low as $1.3320 at one point.

It was one of only a few currencies to gain on the U.S. dollar, which was otherwise broadly firmer.

The U.S. currency cleared 113.00 yen to reach 113.11 JPY=, while the euro touched a two-week low at $1.1770 EUR=. Against a basket of currencies the dollar held firm at 93.786 .DXY.

DIGITAL DARLING

Bitcoin BTC=BTSP crested above $16,600 after climbing more than 47 percent so far this week, intensifying the debate about whether it is a bubble about to burst.

The largest U.S. cryptocurrency exchange struggled to manage record traffic, with an upcoming launch of the first bitcoin futures contract further fuelling investor interest.

Some, however, warned the coming of futures might prove to be the downfall of the digital darling.

“Dragging Bitcoin into the futures market poses a risk of big players opening doors to short selling hell,” said Naeem Aslam, chief market analyst at Think Markets UK.

“Futures markets make it possible to short in decent size with a lot of liquidity, thus affecting the price discovery in the underlying asset market.”

The spectacular rise of the cryptocurrency has stolen some thunder from gold bulls, providing an asset that is also seen as a hedge against inflation and government interference.

Gold finally breached its recent tight trading range on Thursday to hit a four-month trough at $1,246.90 XAU=.

“Demand for gold relative to supply has had centuries to reach an equilibrium,” noted Alan Ruskin, a macro strategist at Deutsche Bank. “Bitcoin global demand is still finding its place relative to constrained/inelastic supply.”

Oil prices went the other way as a threatened strike by oil workers in Nigeria forced a bout of short covering.

Brent futures LCOc1 were at $62.20 a barrel having climbed 98 cents overnight. U.S. crude CLc1 was off 10 cents in early trade at $56.59.

Reporting by Wayne Cole; editing by Richard Pullin

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