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Asian stock markets rise ahead of US jobs data

Asian stock markets are higher ahead of an update on the health of the U.S. jobs market while the Federal Reserve weighs whether more rate hikes are needed to cool surging inflation

Via AP news wire
Friday 05 August 2022 02:12 EDT

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Asian stock markets rose Friday ahead of an update on the U.S. jobs market while the Federal Reserve weighs whether more rate hikes are needed to cool surging inflation.

Shanghai, Tokyo, Hong Kong and Sydney advanced. U.S. futures and oil prices edged higher.

Investors were looking ahead to monthly U.S. employment numbers for possible signs of weakness that might prompt the Fed to decide it needs to ease off on rate hikes to cool inflation. Other data suggest the economy is slowing, which should reduce pressure for prices to rise.

“There is likely to be particular focus on the resilience of jobs growth” after an uptick in unemployment claims, said Anderson Alves of ActivTrades in a report.

The Shanghai Composite Index advanced 0.3% to 3,198.11 while the Hang Seng in Hong Kong rose less than 0.1% to 20,192.36.

The Nikkei 225 in Tokyo gained 0.8% to 28,143.55 after June labor cash earnings rose 2.2% over a year ago, though forecasters warned that strength was unlikely to last. Half-yearly bonuses are paid in June.

The Kospi in Seoul added 0.9% to 2,494.65 and Sydney's S&P ASX 200 advanced 0.4% to 7,003.00.

India's Sensex rose 0.5% to 58,568.12. The Reserve Bank of India raised its benchmark interest rate by a half percentage point to 5.4% on Friday.

RBI Gov. Shaktikanta Das projected that inflation would reach 6.7% in the fiscal year ending next March, and that the economy would grow at a 7.2% annual pace.

New Zealand declined while Southeast Asian markets rose.

Jakarta advanced 0.2% after Indonesia's economy grew by a stronger-than-expected 5.4% over a year earlier in the latest quarter.

Investors worry rate hikes by the Fed and other central banks in Europe and Asia to tame inflation that is running at multi-decade highs might derail economic growth.

The Fed has raised its benchmark rate twice by 0.75 percentage points this year, three times its usual margin and the biggest hikes since the early 1990s.

Fed officials have tried to calm fears the United States might tip into a recession by pointing to a strong job market as evidence the economy can tolerate higher borrowing costs.

The number of Americans who applied for jobless benefits last week rose by a modest 6,000 from the previous week to 260,000, the Labor Department reported Thursday. First-time applications generally reflect layoffs, but forecasters still see the job market one of the strongest parts of the economy.

Data earlier this week indicated the number of new U.S. job openings being advertised slipped but was still near record highs.

On Wall Street, the benchmark S&P 500 index closed 0.1% lower on Thursday while investors digested corporate earnings reports and waited for the jobs data.

The S&P 500 declined to 4,151.94 and the Dow Jones Industrial Average fell 0.3% to 32,726.82. The Nasdaq composite rose 0.4% to 12,720.58.

In energy markets, benchmark U.S. crude gained 42 cents to $88.96 per barrel in electronic trading on the New York Mercantile Exchange. The contract tumbled $2.12 the previous session to $88.54. Brent crude, the price basis for international trading, advanced 27 cents to $94.39 per barrel. It fell $2.66 the previous session to $94.12.

The dollar gained to 133.45 yen from Thursday's 132.91 yen. The euro declined to $1.0230 from $1.0249.

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