Asian markets mixed as U.S. jobs data gives Fed room to raise rates

asian stock exchange


HONG KONG — Asian markets were mixed on Monday after a sharp decline on Wall Street in response to a top-forecast US jobs report that gave the Federal Reserve room to continue raising interest rates as as it struggles to contain the surge in inflation.

U.S. traders took off after closely watched nonfarm payrolls figures on Friday showed a slowdown in hiring but still with more new positions being created than expected.

It came as more officials suggested the Federal Reserve could continue to sharply raise borrowing costs as it tries to tame inflation.

However, with prices being driven higher by factors ranging from the war in Ukraine to the slowdown induced by China’s lockdown, there are fears the bank’s measures could deal a heavy blow to the world’s largest economy.

The jump in inflation has forced finance chiefs around the world to tighten monetary policy, with the European Central Bank indicating it will raise rates in July for the first time in more than a decade.

“The crucial question for markets is whether inflation can be brought under control by central banks without generating a recession,” Shane Oliver, head of investment strategy and chief economist at AMP Capital, said in a note. .

“Equities are set to see continued near-term volatility as central banks continue to tighten to combat high inflation, the war in Ukraine continues and recession fears linger.”

All three major Wall Street indexes ended in the red, with tech companies bearing most of the pain, although Asia fared somewhat better early in trade.

Hong Kong, Tokyo, Shanghai and Taipei all rose, but there were losses in Sydney, Singapore, Manila and Jakarta.

Oil prices – a key driver of inflation – continued to rise as the commitment of OPEC and other major producers to increase production fell short of expectations. markets had hoped.

The increase came as Saudi Arabia also said it had raised the official selling price for customers in Asia, while demand expectations rose due to the easing of some Covid lockdown measures in China and the start of the summer driving season in the United States.

Key figures around 02:30 GMT

Tokyo – Nikkei 225: UP 0.3% to 27,844.26 (pause)

Hong Kong – Hang Seng Index: UP 0.8% to 21,250.08

Shanghai – Composite: UP 0.4% to 3,208.52

North Sea Brent Crude: UP 0.7% to $120.51 a barrel

West Texas Intermediate: UP 0.7% to $119.76 a barrel

Euro/dollar: UP at $1.0721 vs. $1.0719 on Thursday

Pound/dollar: UP to $1.2492 from $1.2488

Euro/pound: UP at 85.83 pence against 85.81 pence

Dollar/yen: FALL to 130.61 yen against 130.81 yen

New York – Dow: DOWN 1.0% to 32,899.7 (closing)

London – FTSE 100: Closed for holidays


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