Nerves ahead of US jobs bring down Asian stocks 

Asian Stocks

Asian stocks declined on the final trading day of the week, as investors awaited the U.S. nonfarm payrolls report for August that may play a crucial role in the Federal Reserve‘s decision about when to lift interest rates.

A strong jobs number could allay fears over global growth, but it could rekindle speculation of an interest rate hike in the U.S. as soon as this month, which could hurt risk assets, particularly in emerging markets.

According to a Reuters survey, U.S. nonfarm payrolls likely increased by 220,000 jobs in August, after July’s 215,000 rise.

“The Fed has alluded to the importance of sustained labor gains, and investors will sit on the edge ahead of the print. A strong print will no doubt fuel speculation that a September rate increase would materialize,” IG’s market strategist Bernard Aw wrote in a note.

Overnight, major U.S. indexes ended mostly higher. The Nasdaq Composite shed 0.4 percent, while the blue-chip Dow Jones Industrial Average and S&P 500 ticked up 0.1 percent each.

Nikkei skids 2.2%

Japan’s benchmark Nikkei 225 index clawed back some losses but remained near the seven-month low of 17,674.4 attained earlier in the session, as the yen strengthened 0.6 percent against the U.S. dollar, denting risk appetite for most counters. The broader Topix index fell 2percent.

Export-oriented stocks tumbled into the red, with the likes of Toyota Motor, Honda and Sony losing near 3 percent each.

Selling pressure also intensified for shares of heavyweight components such as SoftBank, which sold off 4.3 percent after Barclaysdowngraded its rating for the stock to ‘underweight’ from ‘overweight,’ and lowered its target price for the stock to 7,500 yen from a previous target of 8,400 yen. Fast Retailing and industrial robot maker Fanucalso weighed down the bourse by easing more than 2 percent each.

Meanwhile, data released by the Japan Exchange Group on Thursday showed net selling of Japanese cash and futures stocks by foreign investors last week hit a record high, as worries over a China-led slowdown intensified.

Foreigners, who were also net sellers in the previous two weeks, sold a total of 707.05 billion yen ($5.89 billion) worth of Japanese cash stocks during the week of August 24-28, the biggest weekly selling since March 2014.

ASX adds 0.2%

Australia’s S&P ASX 200 index swung between gains and losses all day long.

The day’s gainers included market bellwether BHP Billiton, which elevated 1.2 percent. Other iron ore miners Rio Tinto and Fortescue Metals climbed more than 1 percent each.

In the financial space, Macquarie Group moved up 0.3 percent, but banking plays such as Westpac and National Australia Banksurrendered gains to sag nearly 2 percent each. Commonwealth Bank of Australia and Australia and New Zealand Banking shed 0.5 percent each.

Meanwhile, persistent worries about the health of China’s economy pushed the Australian dollar below 70 U.S. cents.

Kospi loses 1.9%

South Korea’s Kospi index slid deeper into the red, following the deterioration in trading sentiment across the region.

Among tech names which outperformed the bourse earlier on,Samsung Electronics trimmed gains to 0.5 percent. LG Display andSamsung SDI bounced up more than 2 percent each, but chipmaker SK Hynix surrendered gains to dip 1.3 percent.

Carmakers were among the biggest laggards, with Hyundai Motor andKia Motors down 1.3 and 0.6 percent, respectively. Shares of cosmetics makers remain under pressure; AmorePacific and LG Household & Healthcare slid 3.8 and 4.1 percent, respectively.

The country’s largest logistics CJ Korea Express Corp. surged 3.4 percent after it said it was in final talks to acquire China’s Rokin Logistics.

Hang Seng drops 1%

Hong Kong’s key Hang Seng index turned negative alongside other regional bourses, as investors took advantage of the resumption of trade in Hong Kong to sell the shares of mainland-listed companies listed offshore.

The Hang Seng China Enterprises Index tumbled 2.4 percent to become one of the worst performers in the region on Friday.

On the domestic data front, the Nikkei Hong Kong purchasing managers’ index (PMI) fell to a six-year low of 44.4 in August, from 48.2 in July, underscoring a slowdown in the city’s private sector economy. The latest PMI figure also marked a contraction for the sixth consecutive month.

Hong Kong markets were closed on Thursday, as China commemorates the 70th anniversary of the end of World War Two. Meanwhile, China’s stock market reopens on Monday.

Rest of Asia

India’s benchmark S&P BSE Sensex index and the 50-share Nifty index slumped over 2 percent each in early trade, giving up gains from the previous session on offshore losses and anxiety ahead of the U.S. jobs report due later in the global day.

In Southeast Asia, Singapore’s benchmark Straits Times index lead losses with a plunge of 1.5 percent.

Source: CNBC – Nerves ahead of US jobs bring down Asian stocks

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