Asia markets rise, except Japan, ahead of US jobs report

Nov 2, 2022, 11:16 PM | Updated: Nov 3, 2022, 10:18 pm
Currency traders work at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seo...

Currency traders work at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Friday, Nov. 4, 2022. Tokyo’s benchmark declined Friday, while shares in the rest of the region mostly gained, as investors looked ahead to a closely watched U.S. jobs report and fretted over further monetary tightening by the Federal Reserve. (AP Photo/Ahn Young-joon)

(AP Photo/Ahn Young-joon)

TOKYO (AP) — Shares were mostly higher in Asia on Friday led by a 5.8% jump in Hong Kong’s Hang Seng index as Chinese markets were lifted by speculation that Beijing might begin to ease pandemic restrictions.

Tokyo’s Nikkei fell, catching up after Japan’s markets were closed Thursday for a holiday. Investors are watching for signs of recovering demand in China and weighing risks of further interest increases by major central banks to rein in inflation.

Wall Street’s benchmark S&P 500 lost 1.1% on Thursday and the tech-heavy Nasdaq composite index sank 1.7% a day after the Federal Reserve raised its benchmark rate for the sixth time this year. Traders are looking ahead to a closely watched U.S. jobs report due out later Friday.

In the past few days, Chinese shares have climbed on hopes that authorities might begin to ease the country’s stringent COVID-19 controls. That would alleviate supply chain disruptions that have slowed economic activity and pave the way for stronger demand from the world’s No. 2 economy.

There has been no official confirmation of any such policy changes.

Hong Kong’s Hang Seng jumped 16,221.86 while the Shanghai Composite added 2.1% to 3,060.39.

Elsewhere in Asia, Japan’s benchmark Nikkei 225 dropped nearly 2% to 27,120.61. Australia’s S&P/ASX 200 added 0.3% to 6,878.20, and South Korea’s Kospi gained 0.3% to 2,335.72.

The decline on Wall Street came a day after the central bank again raised its benchmark rate and signaled that it may need to keep hiking rates for some time to successfully squash the highest inflation in decades.

The S&P 500 fell 39.80 points to 3,719.89. The Dow lost 0,5% to 32,001.25. The Nasdaq slid 181.86 points to 10,342.94. Smaller company stocks also lost ground. The Russell 2000 fell 0.5% to 1,779.73.

Expectations of higher interest rates helped push up Treasury yields, weighing on stocks. The two-year Treasury note, which tends to track expectations for future Fed moves, rose to 4.72% from 4.61% late Wednesday and is now at its highest level since 2007, according to Tradeweb.

The yield on the 10-year Treasury rose to 4.15% from 4.09% late Wednesday. The rise in the 10-year Treasury yield has prompted mortgage rates to more than double this year and it continues putting pressure on stocks.

The central bank’s latest three-quarters-of-a-percentage-point raise brings short-term interest rates to a range of 3.75% to 4%, its highest level in 15 years. Wall Street is evenly split on whether the central bank ultimately raises rates to a range of 5% to 5.25% or 5.25% to 5.50% next year.

Higher rates not only slow the economy by discouraging borrowing, they also make stocks look less appealing compared to lower-risk assets like bonds and CDs.

Stubbornly hot inflation has been prompting central banks around the world to also raise interest rates. On Thursday, the Bank of England announced its biggest interest rate increase in three decades. The increase is the Bank of England’s eighth in a row and the biggest since 1992.

Investors had been hoping for economic data signaling that the Fed might avoid more rate hikes that might go too far in slowing the economy and bring on a recession. But hotter-than-expected data from the employment sector this week has so far signaled that the Fed will remain aggressive. On Friday, Wall Street will get a broader update from the U.S. government’s October jobs report.

So far, hiring and wage growth have not fallen fast enough for the Fed to slow its inflation-fighting efforts. If the October data shows a stronger-than-expected rise in hiring or wages, that could put pressure on the Fed to keep raising interest rates.

The Labor Department is expected to report that nonfarm employers added 200,000 jobs last month. That would be the worst showing since December 2020, when the economy lost 115,000 jobs.

Investors will also be looking ahead to the latest data on inflation at the consumer level. That report, the consumer price index, is due out next week.

“A busy week ahead for economic releases is expected with the key focus on U.S. and China inflation figures for October. China will also update October trade figures. The United Kingdom meanwhile releases third quarter GDP figures while Germany’s industrial production data will also be due,” S&P Global Market Intelligence said in its report on the upcoming week.

Wall Street has also been closely watching the latest company earnings reports. The reports have been mixed and many companies have warned that inflation will likely continue pressuring operations.

In energy trading Friday, benchmark U.S. crude rose 67 cents to $88.84 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, gained 65 cents in London to $95.32 a barrel.

In currency trading, the U.S. dollar inched down to 148.06 Japanese yen from 148.25 yen. The euro cost 97.74 cents, up from 97.50 cents.

___

AP Business Writers Damian J. Troise and Alex Veiga contributed to this report.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

FILE - Florida state Rep. Joe Harding listens during a Local Administration and Veterans Affairs Su...
Associated Press

Florida lawmaker indicted, accused of fraud on virus loan

TALLAHASSEE, Fla. (AP) — Florida state Rep. Joe Harding has been indicted on charges of defrauding a federal loan program intended to help small businesses during the coronavirus pandemic, officials said Wednesday. Federal prosecutors said Harding, 35, illegally obtained or tried to obtain more than $150,000 from the Small Business Administration in pandemic aid loans. […]
16 hours ago
Associated Press

Pentagon splits $9 billion cloud contract between 4 firms

WASHINGTON (AP) — Google, Oracle, Microsoft and Amazon will share in the Pentagon’s $9 billion contract to build its cloud computing network, a year after accusations of politicization over the previously announced contract and a protracted legal battle resulted in the military starting over in its award process. The Joint Warfighter Cloud Capability is envisioned […]
16 hours ago
FILE - The Apple logo is illuminated at a store in the city center in Munich, Germany, on Dec. 16, ...
Associated Press

Apple: Most iCloud data can now be end-to-end encrypted

BOSTON (AP) — As part of an ongoing privacy push, Apple said Wednesday it will now offer full end-to-encryption for nearly all the data its users store in its global cloud-based storage system. That will make it more difficult for hackers, spies and law enforcement agencies to access sensitive user information. The world’s most valuable […]
16 hours ago
FILE - A group of visitors return to Stephen C. Foster State Park after an overnight camping trip o...
Associated Press

Interior secretary: `Unacceptable’ to mine near famed swamp

SAVANNAH, Ga. (AP) — A member of President Joe Biden’s Cabinet is urging Georgia officials to deny permits for a proposed mine near the edge of the famed Okefenokee Swamp and its vast wildlife refuge, saying the plan poses “unacceptable risk” to the swamp’s fragile ecology. “I write to express serious concerns regarding proposed mining […]
16 hours ago
Associated Press

How major US stock indexes fared Wednesday 12/7/2022

More weakness in tech stocks sent Wall Street mostly lower after another day of wobbly trading. The S&P 500 ended 0.2% lower Wednesday, its fifth straight loss. The Nasdaq, which is heavily weighted with tech companies, lost 0.5%. The Dow Jones Industrial Average ended just barely in the green. Treasury yields fell. Campbell Soup rose […]
16 hours ago
Associated Press

Campbell, MongoDB rise; Smith & Wesson, AeroVironment fall

NEW YORK (AP) — Stocks that traded heavily or had substantial price changes Wednesday: Mastercard Inc., down 11 cents to $347.42. The processor of debit and credit card payments raised its dividend and approved a $9 billion stock buyback program. Pinterest Inc., down 4 cents to $22.68. The digital pinboard and shopping tool company announced […]
16 hours ago

Sponsored Articles

(Desert Institute for Spine Care photo)...
DESERT INSTITUTE FOR SPINE CARE

Why DISC is world renowned for back and neck pain treatments

Fifty percent of Americans and 90% of people at least 50 years old have some level of degenerative disc disease.
...
Quantum Fiber

Stream 4K and more with powerful, high-speed fiber internet

Picking which streaming services to subscribe to are difficult choices, and there is no room for internet that cannot handle increased demands.
...
Day & Night Air Conditioning, Heating and Plumbing

Ways to prevent clogged drains and what to do if you’re too late

While there are a variety of ways to prevent clogged drains, it's equally as important to know what to do when you're already too late.
Asia markets rise, except Japan, ahead of US jobs report