Asian stocks saw gains as investors waited for US employment data

Amidst the epidemic of corona virus disease (COVID-19), the Tokyo Stock Exchange (TSE) has been monitoring stock index prices against the US dollar and the Japanese yen exchange rate since the start of trading in 2022. Tokyo, Japan January 4, 2022. REUTERS / Issei Kato

HONG KONG, Jan 7 (Reuters) – Asian stocks fell for two days on Friday, as investors’ data on late-day US jobs rose as they waited to see if a strong U.S. interest rate hike could strengthen demand.

Wide index of MSCI of Asia-Pacific equities outside Japan (.MIAPJ0000PUS) 0.3%, up 1.2% on the Australian scale (.AXJO) Bank shares were in the lead though Japan’s Nikkei (.N225) Early gains dropped to 0.66%.

Nasdaq Futures rose 0.5% in previous Asian trade, leaving some gains to trade 0.25% higher, and the S&P 500 e-Mini stock futures advanced 0.17%.

Kerry Craig, a global market strategist at JPMorgan Asset Management, said U.S. yields were a key market driver this week following the Federal Reserve’s December minutes release.

The minutes released on Wednesday showed that a tight job market and persistent inflation could force the US Federal Reserve to raise rates even more sharply this year.

“Although we see a slight decline in yields at the end of the session, share the future and see what is now open in Asia,” Craig said.

Benchmark 10-year Treasury paper yield was 1.7211% last night, reaching 1.7530% overnight, the highest since April 2021 at 1.5118% in 2021.

The two-year yield, which is closely linked to inflation expectations, ranged from an overnight high of 0.886% to 0.8656%.

JPMorgan’s Craig said investors were waiting for non-US farm wages data to come in late Friday and inflation data for next week.

High-yield technology stocks have been hit this week as investors spin into stocks of companies that perform well in high-rate environments such as banks.

MSCI’s Asian benchmark, which gives significant weight to many major technology names, fell 1.1% this week, although technology stocks rallied on Friday, particularly from South Korea’s Samsung Electronics Co Ltd. (005930.KS). Samsung rose 1.4% after recording its best quarterly operating profit in four years. read more

Overnight, US stocks fell slightly with rising yields, but losses were largely offset by the sharp fall of the previous week.

In the currency markets, higher yields represent the dollar index, which measures the greenback against six peers, up 0.63% this week.

On Friday, the greenback kept its gains against most majors, advancing 0.1% against the yen, which was 115.94 against the dollar, its five-year high of 116.34 on Tuesday.

Oil prices rose on news that Russian paramedics had arrived in Kazakhstan to quell unrest, although production in the OPEC +-producing country was largely unaffected. read more

Brent crude was up 0.6% at $ 82.48 a barrel, while US crude was up 0.6% at $ 79.96.

After hitting a two-week low of $ 1,788.25 on Thursday, spot gold rose 0.15% to $ 1,791.85 an ounce, with US Treasury yields hitting demand for the metal.

Report by Stella Q in Beijing, Kanupriya Kapoor in Singapore and Alun John in Hong Kong; Editing by Kenneth Maxwell

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