Asian Shares Mostly Lower as Investors Await U.S. Jobs Data
A stronger reading could increase the chances of a rise in U.S. interest rates by year-end
Asian stock markets drifted mostly lower Friday, as investors looked to a coming jobs report in the U.S. for clues about when the Federal Reserve will raise interest rates.
Australia’s S&P/ASX 200 was down 0.8% at 5074.20, following patchy performance overnight in U.S. markets. Singapore’s benchmark index was 0.5% lower. Japan’s Nikkei 225, which had fallen in the morning, rose 0.1% to 17,738.66. South Korea’s Kospi was flat.
Hong Kong’s Hang Seng Index, which reopened after a holiday Thursday, was up 2.6%, helped by slightly stronger than expected Chinese manufacturing data reported Thursday.
Despite Hong Kong’s gains, the broader weakness signals investors’ continued caution, after slowing growth in China and market volatility shook stocks globally and made the three months to the end of September the worst quarter for many markets in years.
The health of the global economy remains among investors’ biggest concerns, particularly as demand falters in China, the world’s second-largest economy.September’s growth in manufacturing has been tepid at best.
“The headlines don’t tell the story. Look under the hood. Here, the screws are coming loose,” said Frederic Neumann, co-head of Asian economic research at HSBC.
In Japan, SoftBank Group Corp. fell 1.1% and Hitachi Ltd. was 1.3% lower. Aeon Corp. was 2% higher after a Nikkei report said its group operating profit likely rose more than previously expected. Among Australian stocks, Rio Tinto Ltd. was 1.4% lower.
In currency markets, the Japanese yen was little changed against the U.S. dollar, trading at ¥119.99 to the dollar compared with ¥119.92 at the close of U.S. markets. The Australian dollar was flat against its previous close, while Malaysia’s ringgit lost 0.8%. The ringgit has been Asia’s worst performing currency in recent months because of the country’s exposure to falling commodity prices and a continuing political scandal.
Many investors are watching closely for improvement in economic indicators, particularly from the U.S., which is set to release monthly jobs data late Friday. A brighter jobs picture could offer Fed officials reason to raise short-term interest rates later this year.
In Asia, better-than-expected Chinese manufacturing data Thursday offered some relief from the string of disappointing readings in recent weeks, particularly for Hong Kong-listed stocks when trading resumed Friday. In Australia, data on Friday showed retail sales rose 0.4% in August from a month earlier, slightly better than expectations.
Still, analysts remain cautious about reading too much into any short-term positive data. “Our global economists believe that near-term global recession risks are higher than usual, with a 25% chance of a recession-like slump this year,” Bank of America Merrill Lynch said in a note.
In Japan, a central bank survey Friday showed that companies’ inflation expectationsweakened broadly over the third quarter, a sign that the Bank of Japan’s campaign to generate stable 2% inflation may be faltering.
In commodity markets, Brent crude prices rose 0.9% Friday, to US$48.14 a barrel.
Chinese markets remained closed Friday for a national holiday celebration. Indian markets were also closed.
Source: WSJ – Asian Shares Mostly Lower as Investors Await U.S. Jobs Data
