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Asian markets swing as focus turns to US jobs data

Asian markets swing as focus turns to US jobs data

HONG KONG: Asian markets fluctuated Tuesday following another healthy month for global equities, fuelled by expectations of cheap borrowing for years to come, while traders were turning their attention to the release of US jobs data later in the week.

While the Nasdaq powered to yet another record as tech firms are fired by people being forced to stay at home by the virus, the Dow and S&P 500 dipped, though both enjoyed their best August in more than 30 years.

Signs of a new pick-up in infections around the world and a lack of any movement on a new US stimulus package for the world’s top economy were also keeping buying sentiment at bay.

“Following such a strong month and such a strong recovery since we saw the trough back in March, we do think we could see some turbulence over the next few months,” Tracie McMillion, at Wells Fargo Investment Institute, told Bloomberg Television.

“We’re entering a seasonally weaker period, we’ve got elections on the horizon, and also we’re entering the fall and there could be some coronavirus escalation that also could start to worry market participants.”

Hong Kong and Shanghai were both down 0.2 percent and Sydney dropped 1.8 percent, while Singapore and Wellington were also in the red.

Tokyo ended the morning flat, though Seoul and Manila jumped 0.8 percent with Jakarta and Taipei also in positive territory.

The key event this week is the release Friday of closely watched US non-farm payrolls figures, which will provide the latest snapshot of an economy that has been struggling in recent weeks from the reimposition of some containment measures owing to fresh flare-ups across the country. Updates on the factory and services sectors are also due this week.

Still, the weakness has not given US lawmakers any urgency to push through a new rescue deal, with Republicans and Democrats still at loggerheads.

Treasury Secretary Steven Mnuchin said Republicans will soon unveil a new spending bill “for kids and jobs”, which is likely to come in around $1 trillion, less than half that offered by Democrats.

He said Democratic leaders in the House and Senate “just don’t want to negotiate in good faith”, and with senators on recess until September 8, there is little chance of anything being agreed soon.

“Not only is ambivalence hurting the nascent economic recovery, more importantly it keeps the neediest checking their mailboxes regularly while praying a second stimulus check miraculously arrived,” said Stephen Innes at AxiCorp.

“We are talking about people needing to buy groceries, not luxury items here. It’s time for Congress to get off their derrieres and put something actionable together.”