By Tom Westbrook
SINGAPORE (Reuters) - Gold looked set for its largest weekly gain in over 13 months on Friday as escalating geopolitical tensions drove investors to safe assets, while a tech rebound led Asian equities higher after worries over Nvidia's sales growth eased.
In a week that saw Russia lowering its threshold for using nuclear weapons and firing a hypersonic ballistic missile at Ukraine, investors' appetite for riskier assets has been blunted, though bitcoin stood on the brink of breaking the $100,000 barrier for the first time.
Futures indicate European bourses were set for a muted open, with Eurostoxx 50 futures up 0.21%, German DAX futures 0.17% higher and FTSE futures climbing 0.35%.
Fears of escalation sent European gas prices to a one-year high and pushed investors towards safe havens, underpinning German debt and putting the Swiss franc on course for its first weekly rise in two months.
In Asia on Friday, chipmakers' stocks inched stocks after Nvidia touched a record high in U.S. trade on solid earnings, with shares in Taiwan rising 1.5% and South Korea gaining about 1%. The Nikkei advanced 0.8%.
Disappointing corporate earnings weighed on sentiment in China, however. The blue-chip CSI300 index was down 1.6% and Hong Kong's Hang Seng Index slid 1.75%.
Gold was up 0.7% at $2,688 an ounce, rising more than 4.5% for the week so far, its strongest weekly performance since Oct. 2023.
Shares of Adani Group companies and their dollar bonds remained under pressure following Chairman Gautam Adani's indictment for fraud by U.S. prosecutors.
Russia on Tuesday lowered its threshold for using nuclear weapons and responded overnight to the U.S. and UK allowing Kyiv to strike Russian territory with Western weapons by firing a hypersonic intermediate-range missile at Ukraine's Dnipro.
"Those weapons typically carry nuclear warheads," said analysts at ANZ Bank, noting the attack sent oil prices higher. "The exchange indicates the war has entered a new phase, raising concerns around disruptions to supply."
Brent crude futures were up nearly 4.5% on the week and edged up to a two-week high of $74.44 a barrel in Asia trade. They were last at $74.22.
The euro has been friendless and down for seven of the past eight weeks as Europe faces U.S. tariffs, slowing growth, the collapse of Germany's government and strains in France's government over its 2025 budget.
"There doesn't seem to be anything on the plus side of the euro ledger just at the moment," said National Australia Bank's head of FX research, Ray Attrill.
At $1.0469 the common currency is close to breaking support at last year's low of $1.0448. European stocks are also headed for a fifth weekly drop in a row, while world stocks are up 1% this week.
The dollar index eyed a weekly gain of 0.4% and touched 13-month high of 107.18. Benchmark 10-year Treasury yields held at 4.432%, more or less steady on the week.
Markets imply about a 58% chance of a Fed cut, down from 83% a week earlier.
Data in Japan showed core inflation held above the central bank's 2% target in October, keeping pressure for a rate rise. Markets are pricing in about a 57% chance of a 25-basis-point Bank of Japan rate hike in December and the prospect has injected some volatility and even support for the yen.
The yen was last at 154.82 per dollar, and has slid 4% this quarter.
"Together with speculation about (finance ministry) intervention, I think selling on upticks on dollar/yen is quite decent," said Keita Matsumoto, head of financial institution sales and solutions at Citigroup (NYSE:C) Global Markets Japan in Tokyo.
"Our investor clients and corporate clients are rather sellers of dollar/yen close to 155."