Asian markets mixed with US rally unable to inspire

10-Dec-2019 Intellasia | AFP | 6:02 AM Print This Post

Asian markets were mixed Monday as investors struggled to track a rally on Wall Street that was fuelled by a forecast-busting US jobs report, while there was little inspiration from tepid Chinese trade data.

While observers widely expect Beijing and Washington to hammer out a partial tariffs agreement, trading floors remain nervous places with less than a week until a deadline when the US is due to impose fresh levies on Chinese goods.

Hopes that the US and global economy could be showing signs of picking up were given a boost Friday when the Labour Department said the US economy created 266,000 net new jobs in November, while it upgraded its readings for the previous two months.

The figure was well up from the 190,000 expected, while the report also showed unemployment at a 50-year low and wages growth improving.

The data “could support the notion (of) a near-term rebound in the US and the global economy,” said AxiTrader’s Stephen Innes.

“Even if you don’t believe that narrative while thinking we are merely in the calm between two storms, it’s challenging to critique this… report in any other light than to describe it as excellent, if not a total blockbuster.”

Eyes are now on the Federal Reserve’s next policy meeting, which ends on Wednesday, with analysts expecting it to hold off cutting interest rates for a fourth time this year.

Tariffs deadline looms

All three main indexes on Wall Street ended sharply higher but Asia was failed to gain traction.

Shanghai finished 0.1 percent higher and Tokyo ended up 0.3 percent, while Hong Kong was barely moved.

Mumbai, Sydney and Seoul each added 0.3 percent, Taipei climbed 0.4 percent and Jakarta gained 0.1 percent. Wellington, Singapore, Manila and Bangkok all fell.

Chinese trade data failed to provide any excitement. Data showed at the weekend that exports fell more than expected as the tariffs spat with the US grinds on, though imports beat forecasts.

Dealers are also keeping abreast of progress in the China-US trade talks, with most bets on a deal eventually being struck.

White House economic aide Larry Kudlow told CNBC an agreement “is still close” and that the two sides talk almost daily, while Treasury Secretary also said the discussions were on track.

However, with still nothing concrete being announced, there are worries that the US will enact a fresh round of tariffs in China on December 15. Beijing has called for the levies to be removed as part of any deal and the fear is that a new batch of measures could derail the talks.

Oil prices retreated after Friday’s healthy gains that came in reaction to news that OPEC and other major producers led by Russia had agreed to cut output by a further 500,000 barrels a day in addition to their current agreement.

Adding to buying was a decision by kingpin Saudi Arabia and other key countries to make additional reductions.

On currency markets the pound was holding gains just days ahead of the UK general election, which is expected to see prime minister Boris Johnson’s Conservatives win a big enough majority to push through his Brexit deal.

In early trade London and Paris each dipped 0.1 percent, while Frankfurt was flat.

Key figures around 0820 GMT

TokyoNikkei 225: UP 0.3 percent at 23,430.70 (close)

Hong KongHang Seng: FLAT percent at 26,494.73 (close)

ShanghaiComposite: UP 0.1 percent at 2,914.48 (close)

LondonFTSE 100: DOWN 0.1 percent at 7,230.91

euro/dollar: UP at $1.1062 from $1.1058 at 2130 GMT on Friday

Pound/dollar: UP at $1.3170 from $1.3137

euro/pound: DOWN at 83.99 pence from 84.17 pence

Dollar/yen: UP at 108.60 yen from 108.56 yen

West Texas Intermediate: DOWN 30 cents at $58.90 per barrel

Brent North Sea crude: DOWN 23 cents at $64.16 per barrel

New YorkDow: UP 1.2 percent at 28,015.06 (close)


Category: FinanceAsia

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