U.S. jobs report, dollar moves, oil prices

Signage outside the Tokyo Stock Exchange (TSE), operated by Japan Exchange Group Inc. (JPX), in Tokyo, Japan, on Monday, Jan. 4, 2021.

Noriko Hayashi | Bloomberg via Getty Images

SINGAPORE — Asia-Pacific stock markets were mostly higher on Thursday as investors look ahead to the U.S. jobs report due later this week for clues about how long the Fed will stay on hold.

Japanese markets returned to trade for the first time this week after being closed for public holidays. The benchmark Nikkei 225 jumped 1.98% while the Topix index was up 1.97%.

South Korea’s Kospi, which was also closed in the previous session, rose 0.7%. In Hong Kong, the Hang Seng index was up 1.15%.

Chinese mainland shares traded for the first time in May after being shut for public holidays. The benchmark Shanghai composite rose 0.21% while the Shenzhen component declined 0.87%.

Meanwhile, Australia’s ASX 200 slipped nearly 0.6% as most sectors were in negative territory.

Thursday’s session in Asia-Pacific follows a mixed finish overnight on Wall Street where the Dow Jones Industrial Average ended at a new all-time closing high.

U.S. jobs report

The U.S. jobs report — one of the most influential economic reports in global financial markets — for April is due on Friday and economists say payrolls could easily reach 1 million after 916,000 jobs were added in March.

Federal Reserve Vice Chairman Richard Clarida told CNBC’s “Closing Bell” on Wednesday that, as the jobs picture in the U.S. continues to improve, there needs to be considerable progress before the central bank will feel comfortable enough to pull back on all of the help it has provided since the Covid-19 pandemic cut short the longest expansion in U.S. history.

Treasury Secretary Janet Yellen this week said that interest rates may have to rise to keep a lid on the burgeoning growth of the U.S. economy brought on in part by trillions of dollars in government stimulus spending. She later tempered her comments somewhat on the need for higher rates.

“Despite constant reassurances from Yellen and an array of Fed officials that the coming increase in inflation will prove ‘transitory’ … markets are evidently a bit more worried,” Rodrigo Catril, senior foreign-exchange strategist at the National Australia Bank, said in a morning note.

“Options prices indicate that the market (sees) a greater than one-in-three chance than US CPI could average more than 3% over the coming five years,” he said, adding that strong commodity prices have also helped to lift inflation expectations.

Currencies and oil

The U.S. dollar slipped 0.06% to 91.255 against a basket of its peers, as the dollar index stayed relatively rangebound.

Elsewhere, the Japanese yen changed hands at 109.31 per dollar, weakening from an earlier level around 109.14, while the Australian dollar was up 0.1% at $0.7755.

Oil prices slipped Thursday during Asian trading hours. U.S. crude futures were near flat at $65.65, while global benchmark Brent traded 0.1% higher at $69.03 a barrel.

Overnight, Reuters reported that U.S. crude inventories fell by 8 million barrels in the most recent week, exceeding expectations for a 2.3 million-barrel drop, according to the Energy Information Administration.

In corporate news, shares of Singapore Press Holdings, publisher of the city-state’s daily broadsheet the Straits Times, were halted from trading pending a news announcement.

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