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HONG KONG, Jan 25 AFP

January 25 2013, 9:53PM

Asian markets were mixed on Friday, with Tokyo's Nikkei surging to a near three-year high on the back of a weaker yen, while Wall Street provided an uneven lead.

The yen resumed its downtrend after a brief rally.

Tokyo surged 2.88 per cent, or 305.78 points, to 10,926.65, pushing the benchmark index to its best close since April 2010.

Sydney was 0.42 per cent higher, adding 25.0 points to 4,835.2 but Seoul closed 0.91 per cent lower, shedding 17.79 points to 1,946.69.

In the afternoon, Hong Kong lost 0.37 per cent while Shanghai eased 0.22 per cent on profit taking.

Hong Kong closed flat, dipping 18.47 points to 23,580.43, and Shanghai fell 0.49 per cent, or 11.30 points, to end at 2,291.30.

Takehiko Nakao said the government was closely watching the yen's movements in currency markets, adding that "appropriate action" would be taken if it got too strong.

His comments in an interview with the Wall Street Journal sent the yen tumbling in New York on Thursday. The US dollar jumped to Y90.40 from Y88.56 a day earlier. The euro climbed to Y120.91 from Y118.

In afternoon trade in Japan the dollar was at Y90.59 and the euro bought Y121.50. The single currency fetched $US1.3413 - around highs not seen for 11 months - from $US1.3376 in New York.

"Nakao's comments serve as a stark reminder of the government's unrelenting drive to pursue a weaker currency in an attempt to resuscitate the economy," Chris Gore, a currency analyst at Go Markets, said in a note to clients, according to Dow Jones Newswires.

The comments also capped a rise in the yen that began on Tuesday as dealers were left disappointed by the Bank of Japan's plan to set an inflation target to beat deflation, and pursue unlimited monetary easing.

The BoJ move, which came after pressure from the government, raised eyebrows around the world and stoked fears of another currency war as governments look to weaken their currencies to boost exports.

German Chancellor Angela Merkel said: "I will admit I am not without some concern about Japan right now." She added that "political influences or manipulations of the exchange rate" have become a hot topic within the Group of 20.

However, Japan's Finance Minister Taro Aso on Friday rejected claims that Tokyo was orchestrating a slide in the yen, with the online version of the Nikkei quoting him as saying such criticism "is completely off the mark".

Highlighting the work ahead for Japan's new leaders, official data on Friday showed the economy remained stuck in a deflationary rut, with core consumer prices slipping 0.1 per cent in 2012, the fourth annual decline.

Traders took heart from another rise on the Dow, which ended 0.33 per cent higher after figures were released showing weekly US jobless claims fell for a second straight week, but Wall Street's other two major indexes fared less well.

The S&P 500 was flat and the tech-rich Nasdaq fell 0.74 per cent, dragged by a 12 per cent plunge in Apple after the iPhone maker's latest earnings report fell short of expectations.

Seoul, which fell on weak economic growth figures on Thursday, took another hit on Friday after index giant Samsung Electronics posted below-forecast results for the October-December fourth quarter.

Oil prices were mixed, with New York's main contract, light sweet crude for delivery in March, rising 28 cents to $US96.23 a barrel and Brent North Sea crude for March delivery rising 17 cents to $US113.45.

Gold was at $US1,670.26 at 0840 GMT (1940 AEDT) compared with $US1,677.37 late on Thursday.

In other markets:

- Taipei fell 0.30 per cent, or 23.41 points, to 7,672.58.

Hon Hai Precision rose 1.09 per cent to Tw$83.4 while TSMC was 0.9 per cent lower at Tw$99.0.

- Manila closed 0.82 per cent higher, adding 50.37 points to 6,167.64.

Ayala rose 1.85 per cent to 552 pesos, Alliance Global Group gained 0.11 per cent to 17.48 pesos and Manila Electric was 1.5 per cent up at 284.60 pesos.

- Wellington rose 0.24 per cent, or 9.91 points, to 4,199.82.

Fisher & Paykel Healthcare was up 2.1 per cent at NZ$2.49 and Telecom added 1.9 per cent to NZ$2.38.

By Danny McCord