Asian stock markets were broadly higher on Friday after Bank of England Gov. Mark Carney signaled a stronger possibility of a summer rate cut to support the U.K. economy in the wake of the country's vote last week to exit the European Union.

Japan's Nikkei Stock Average was up 0.7% while Australia's ASX 200 was 0.6% higher. South Korea's Kospi was up 0.8%. New Zealand's NZX 50 was 0.1% higher.

On the mainland, the Shanghai Composite Index was up 0.5%. Hong Kong's stock market was closed for the Special Administrative Region Establishment Day holiday, marking its transfer from the U.K. to China.

Britain's central bank chief said Thursday the U.K.'s growth will slow in coming months and that further interest-rate cuts and other measures will be needed, even as he declared his confidence in the country's ability to adapt to a future outside the European Union. His comments helped boost U.S. and European stocks overnight.

After plummeting last week on the vote result, Asian shares have rallied this week as concerns over the decision began to abate.

"The U.K's economy isn't that big. It's unlikely that the impact of an exit would reverberate through the entire global economy and worsen it," said Soichiro Monji, general manager of economic research at Daiwa SB Investments.

Mr. Monji said the U.K.'s economy might be even helped by a cheaper British pound, and the outlook is actually shakier for the European Union, where politicians in some other countries have also called for referendums on EU membership.

The British pound was at 137.24 yen, weaker than late Thursday' s Y137.36 in New York. The sterling was at $1.3343, compared with $1.3311 in late New York trading.

The Bank of Japan's latest tankan poll, a quarterly survey of business confidence, showed Friday the sentiment among Japanese banks hit its lowest point in three-and-a-half years in the April-June quarter while manufacturers' sentiment remained solid in the second quarter.

Write to Kosaku Narioka at kosaku.narioka@wsj.com

(END) Dow Jones Newswires

July 01, 2016 00:15 ET (04:15 GMT)