Coin Press - Asian markets swing as traders prepare for US jobs data

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Asian markets swing as traders prepare for US jobs data
Asian markets swing as traders prepare for US jobs data / Photo: MOHD RASFAN - AFP

Asian markets swing as traders prepare for US jobs data

Asian markets drifted Friday as traders positioned themselves ahead of a highly anticipated US jobs report later in the day and following a mixed bag of economic data on the world's top economy.

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As a rollercoaster week drew to a close, debate centred on the Federal Reserve's plans for interest rates when it meets in less than a fortnight, with most observers expecting a 25-basis-point cut.

However, analysts say it could go twice as big if the non-farm payrolls report for August comes in well below forecasts as a series of recent figures suggest the economy is slowing more sharply than initially thought.

A big miss in July's reading fanned fears of a recession and was a key driver of the rout across markets at the start of last month.

Investors were given a slight jolt by data Thursday showing a miss on private-sector hiring, which was slightly offset by a dip in first-time and continuing claims for jobless benefits.

A separate report pointed to a marginal increase in activity in the key services sector, which beat expectations.

"There has been nothing in the latest batch of US economic data... to materially impact on expectations for (Friday's) all-important employment data or to move the dial on expectations for what the Fed is likely to do on September 18," said National Australia Bank's Ray Attrill.

Wall Street ended the day on a tepid note, and Asian investors were equally cautious.

Shanghai, Sydney, Singapore, Taipei, and Jakarta rose, while Tokyo, Seoul, Manila, and Wellington fell.

The calm end to the week came after markets were sent tanking Wednesday following a disappointing read on factory activity and worries about tech firms' valuations -- particularly chip giant Nvidia -- after a rally this year.

Analysts warned that there was a lot of risk in Friday's jobs figures, with a sharp drop likely to boost bets on a 50-point cut but stoking fresh recession worries, while an above-forecast read denting hopes for a series of cuts this year.

Traders have factored in one percentage point-worth of reductions before the end of the year.

"One thing is becoming increasingly evident: the more the market leans into the idea of a 50 basis point cut, the shakier equities get," said Stephen Innes in his Dark Side Of The Boom newsletter.

"This week’s relentless market slide is a reflection of mounting fears that a 50 basis point cut isn’t a soft cushion but rather a red flag signalling turbulent economic waters ahead."

- Key figures around 0230 GMT -

Tokyo - Nikkei 225: DOWN 0.2 percent at 36,568.05 (break)

Shanghai - Composite: UP 0.3 percent at 2,797.09

Hong Kong - Hang Seng Index: Closed for typhoon

Dollar/yen: DOWN at 143.21 yen from 143.42 yen on Thursday

Euro/dollar: UP at $1.1114 from $1.1110

Pound/dollar: DOWN at $1.3178 from $1.3180

Euro/pound: UP at 84.34 pence from 84.29 pence

West Texas Intermediate: UP 0.2 percent at $69.27 per barrel

Brent North Sea Crude: UP 0.2 percent at $72.81 per barrel

New York - Dow: DOWN 0.5 percent at 40,755.75 (close)

London - FTSE 100: DOWN 0.3 at 8,241.71 (close)

U.Ndiaye--CPN