Asia stocks edge up

Dhaka,  Sat,  23 September 2017
Published : 04 Aug 2017, 12:29:03

Asia stocks edge higher, dollar languishes on US politics, mixed data

Asian stocks inched up on Friday after a technology-led drop on Wall Street, while US Treasury yields and the dollar were pressured by news Special Counsel Robert Mueller had issued grand jury subpoenas in his investigation of alleged Russian interference in the 2016 US elections.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.2 per cent, although gains were kept in check by the reluctance of many investors to stake out fresh positions ahead of US job data later in the global day.

The index was poised to climb 0.3 per cent for the week, taking its gains for far this year to nearly 24 per cent.

Japan's Nikkei dropped 0.3 per cent on a stronger yen, and looked set to end the week little changed.

South Korea's KOSPI, which closed at a 3-1/2-week low on Thursday, recovered 0.3 per cent. It is down 0.4 per cent this week.

China's blue-chip CSI 300 lost 0.3 per cent, while Hong Kong's Hang Seng gained 0.1 per cent.

Overnight, the S&P and Nasdaq closed 0.2 per cent and 0.35 per cent lower respectively, with the declines led by technology shares.

But the Dow managed to post slight gains, staying above the 22,000 level breached on Wednesday.

US stocks fell to intraday lows late on Thursday after the Wall Street Journal reported that Mueller has empanelled a grand jury to investigate allegations of Russian interference in the 2016 presidential election.

Two sources told Reuters on Thursday that grand jury has issued subpoenas in connection with a June 2016 meeting that included US President Donald Trump's son, his son-in-law and a Russian lawyer.

"Politics come to the forefront once again with the latest developments in the Trump-Russia probe," said Jingyi Pan, market strategist at IG in Singapore, but added that "equity markets continued with a semblance of calm awaiting Friday’s US jobs report".

Investors will scrutinise July's employment report for clues on whether it could influence the timing of the Federal Reserve's plans to tighten monetary policy.

Non-farm payrolls were expected to have increased by 183,000 jobs last month after surging by 222,000 in June, Reuters survey of economists found. The unemployment rate is seen falling one-tenth of a percentage point to 4.3 per cent.

The dollar index, which tracks the greenback against a basket of six major peers, languished near the 15-month low hit earlier this week. It was down almost 0.1 per cent on Friday at 92.779, set to end the week 0.5 per cent lower.

The dollar crept up 0.1 per cent to 110.125 yen, but failed to make up most of Thursday's 0.6 per cent loss. It is on track for a weekly loss of 0.5 per cent.

Benchmark 10-year notes were at 2.2247 per cent on Friday. On Thursday, they fell to as low as 2.218 per cent, their lowest level since late June, and closed at 2.228 per cent.

Sterling hit a nine-month low against the euro overnight, and held near that level on Friday, after the Bank of England's policymakers kept interest rates at a record-low 0.25 per cent.

"The unsavoury combination of uninspiring UK economic data in July and uncertainty surrounding Brexit talks has pressured BoE hawks and dented expectations of a rate hike occurring anytime soon," Lukman Otunuga, research analyst at ForexTime, wrote in a note.

"With the central bank downgrading its UK GDP growth forecast for both this year and 2018, sterling is poised for further punishment down the road."

Sterling was 0.9041 to the euro on Friday, after falling to as low as 0.9048, its weakest since Nov 2.

That helped lift the FTSE 0.85 per cent.

A 0.5 per cent jump in retail sales in the euro zone in June from May, well above market expectations of a 0.1 per cent rise, gave the euro a boost.

The common currency was up 0.1 per cent to $1.1879, extending Thursday's 0.1 per cent gain. It is set to end the week 1.2 per cent stronger.

Venezuela's bolivar currency tumbled 18 per cent against the US dollar on Thursday on the black market, ahead of the inauguration of a legislative superbody that the opposition says will give President Nicolas Maduro sweeping new powers.

In commodities, oil prices remained under pressure following losses overnight. Persistent concerns about high crude supplies from OPEC offset the previous day's data showing record US gasoline demand.

US crude was marginally higher at $49 a barrel, after sliding 1.1 per cent overnight, putting it on track for a weekly loss of 1.4 per cent.

Global benchmark Brent slipped almost 0.1 per cent to $51.96, extending Thursday's 0.7 per cent loss, headed for a 1.05 per cent weekly decline.

Gold was steady, holding on to Thursday's 0.15 per cent gain. Spot gold was at $1,268.66 an ounce, after Thursday's 0.15 per cent gain, and set to end the week little changed. 

Editor : A.H.M Moazzem Hossain
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