Asia’s equities are mixed

Asia starts the week in a cautious mood

Friday’s US Non-Farm Payroll data dampened inflation fears and lifted US stock markets. NFP rose by 559,000 jobs, a slight miss to consensus, but much less bad than April’s number.

 

The S&P 500 rose 0.88%, the Nasdaq leapt 1.47% higher, and the Dow Jones climbed 0.52% in a very business-as-usual session. US index futures have retreated slightly in Asia, falling around 0.10% in muted trading.

 

Asia has refused to blithely follow Wall Street higher today, presenting a much more mixed picture. The Yellen interest rate comments adding a note of caution. The Nikkei 225 is 0.35% higher, while the Kospi has added 0.15%. Mainland China markets have fallen, though, after export data underperformed this morning. The Shanghai Composite is 0.20% lower while the CSI 300 has fallen by 0.45%, with Hong Kong 0.80% lower.

 

Singapore has risen by 0.75%, with Kuala Lumpur down 0.75% and Taipei edging 0.40% lower. Jakarta is flat while Bangkok has risen 0.80%, with Manila falling 0.45%. Australian markets have shrugged off an impressive rise in ANZ Job Advertisements and an upgrade in outlook by S&P. The ASX 200 is down 0.30%, with the All Ordinaries edging 0.15% lower.

 

The next major risk point is next week’s FOMC meeting. The Fed may well insist that with over 7 million fewer Americans in jobs than before the pandemic, no change, or even talk of change, in monetary policy is required. The US NFIB Survey on Friday showed unfilled positions in small businesses has climbed to record highs of 48%. The survey suggests that employers will have to pay up to get people back to work through or wait for the summer season and those unemployment benefits to run their course. All of which is likely to be inflationary but the market has no way of knowing if it is transitory or structural.

 

Without an overriding theme to drive direction today, local markets have been left to their own devices as Asia seems content to await developments in Northern Hemisphere markets as the week gets started.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Jeffrey Halley

Jeffrey Halley

Senior Market Analyst, Asia Pacific
With more than 30 years of FX experience – from spot/margin trading and NDFs through to currency options and futures – Jeffrey Halley is OANDA’s senior market analyst for Asia Pacific, responsible for providing timely and relevant macro analysis covering a wide range of asset classes. He has previously worked with leading institutions such as Saxo Capital Markets, DynexCorp Currency Portfolio Management, IG, IFX, Fimat Internationale Banque, HSBC and Barclays. A highly sought-after analyst, Jeffrey has appeared on a wide range of global news channels including Bloomberg, BBC, Reuters, CNBC, MSN, Sky TV, Channel News Asia as well as in leading print publications including the New York Times and The Wall Street Journal, among others. He was born in New Zealand and holds an MBA from the Cass Business School.
Jeffrey Halley
Jeffrey Halley

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