- Asia Stocks Look Past Russia Probe to U.S. Jobs
Asian equity markets were mixed on Friday as investors awaiting the monthly U.S. jobs report for clues on interest rates largely shrugged off news that Special Counsel Robert Mueller was said to have impaneled a grand jury in the ongoing Russia probe. The euro maintained gains against the dollar.
Benchmark gauges fell in Japan and Australia, while South Korea’s Kospi index rose after plunging on Thursday. Australian government bonds yields slid in line with the slump in Treasury and bund yields on the news out of Washington where Mueller is probing Russia’s interference in 2016 U.S. elections as well as possible collusion with the Trump campaign. The yen held gains, weighing on stocks in Tokyo.
Geopolitics took center stage again ahead of the closely watched U.S. employment report that may provide clues on the strength of the world’s largest economy and the Federal Reserve’s next policy move.
A largely expectation-topping earnings seasons rolls on. Toyota Motor Corp., among the largest companies to update investors, raised its profit forecast after the Tokyo market closed as the yen weakened and on a rebound in U.S. sales.
The U.S. jobs report for July may show the economy is on a steady trajectory and the labor market is staying tight, according to Bloomberg Intelligence. Consensus expects an increase of 180,000 in non-farm payrolls, after a gain of 222,000 in June, and a decline in unemployment to 4.3 percent from 4.4 percent. The data will also signal if income gains are enough to keep consumer spending ticking.
The Australian dollar tested the session’s low after the country’s central bank cut its growth forecast. The Reserve Bank of Australia lowered its forecast for economic growth by half a percentage point this year to 2 percent to 3 percent, and a quarter-point in the first half of next to 2.5 percent to 3.5 percent, saying in its quarterly monetary-policy statement that the Aussie dollar “had a modest dampening effect” on GDP growth.
Here are the main moves in markets:
Stocks
- Japan’s Topix index slid 0.2 percent and Australia’s S&P/ASX 200 Index lost 0.3 percent. South Korea’s Kospi was up 0.5 percent after sliding 1.7 percent on Thursday. Hong Kong’s Hang Seng Index was little changed, while the Shanghai Composite Index swung between gains and losses.
- Contracts on the Euro Stoxx 50 fell 0.2 percent as of 7:30 a.m. in London.
- Futures contracts on the S&P 500 Index were little changed. The main gauge lost 0.2 percent on Thursday.
Currencies
- The euro traded at $1.1878, on course for a fourth week of gains. The European currency has advanced as the dollar has come under pressure amid concerns about the Trump administration’s ability to carry out its economic policy agenda. Meanwhile,
German factory orders jumped in June, indicating a pickup in momentum in Europe’s largest economy.
- The Aussie fell as low as 79.34 U.S. cents before shrugging off the RBA report to rise 0.2 percent to 79.67. It’s set for its first weekly decline since the start of July. The central bank said the recent appreciation of the exchange rate has had a “modest dampening effect” on growth forecasts.
- The yen was little changed against the dollar to 110.13.
- The Bloomberg Dollar Spot Index was steady.
Bonds
- The yield on 10-year Treasuries held at 2.22 percent after declining five basis points on Thursday.
- Yields on 10-year bunds were steady at 0.46 percent.
- Ten-year yield on Australian government notes fell four basis points to 2.63 percent.
Commodities
- West Texas Intermediate crude extended losses, falling 0.4 percent to $48.84 after losing 1.1 percent in the previous session.
- Gold was steady at $1,269.59 an ounce.
