Asian stocks and US contracts held steady Friday after robust economic data weighed on Wall Street, fueling concerns about a pullback in central bank stimulus. The dollar extended an advance.
Japanese shares fluctuated while China and Australia posted modest increases. European futures were little changed. The US gauges fell overnight but came off lows on signs President Joe Biden may be willing to compromise on corporate taxes. Strong US jobs data and record service-sector growth highlighted the economic recovery. Treasury yields steadied from a climb.
China’s markets weathered Biden’s order amending a ban on US investment in Chinese companies. The order named 59 firms with ties to China’s military or in the surveillance industry, including Huawei Technologies Co.
Gold remained lower after coming under pressure as yields and the dollar pushed higher. The rally in crude oil paused. Meme stocks including AMC Entertainment Holdings Inc. had another volatile US session. Bitcoin fell after a cryptic Elon Musk tweet hinting at a split with the token.
Global stocks are trading in tight ranges as traders weigh the economic recovery against the risk of faster inflation. US payrolls are expected to have added 674 000 jobs in May, according to a Bloomberg survey of economists, and a big miss could stir volatility. St. Louis Fed President James Bullard said the labour market might be tighter than the current unemployment rate suggests.
“If the nonfarm payroll numbers tonight were to surprise to the upside, and I’m talking about anything above 700 000, that’s going to keep the pressure on the US fixed income market and definitely very supportive of the dollar,” Eugenia Victorino, head of Asia strategy at Skandinaviska Enskilda Banken AB in Singapore, said in a Bloomberg TV interview.
For market commentary, follow the MLIV blog. The question of the day is whether the upcoming US jobs report will shift taper talk.
These are some of the main moves in markets:
- S&P 500 futures were steady as of 6:45 a.m. in London. The index shed 0.4%
- Nasdaq 100 contracts declined 0.1%. The gauge dropped 1.1%
- Japan’s Topix index lost 0.1%
- Australia’s S&P/ASX 200 index added 0.5%
- South Korea’s Kospi index shed 0.3%
- Hong Kong’s Hang Seng index rose 0.2%
- China’s Shanghai Composite index increased 0.5%
- The Bloomberg Dollar Spot Index rose 0.1%
- The euro was at $1.2110
- The Japanese yen traded at 110.25 per dollar
- The offshore yuan was at 6.4029 per dollar
- The yield on 10-year Treasuries held at 1.63%
- Australia’s 10-year yield increased three basis points to 1.69%
- West Texas Intermediate crude was at $68.90 a barrel, up 0.1%
- Gold was at $1 868.60 an ounce, down 0.1%