HONG KONG, Sept 1 — Asian markets mostly rose today 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 up by people being forced to stay home by the virus, the Dow and S&P 500 dipped, though both enjoyed their best August in more than 30 years.
But 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 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.”
Shanghai climbed 0.4 per cent, with helping coming from news that a survey of Chinese manufacturing had shown a pick-up in activity, a day after an official reading showed a slight dip in the sector.
Hong Kong and Tokyo were flat, while Mumbai added 1.3 per cent, a day after data showed the Indian economy shrank a historic 23.9 per cent in April-June, which was worse than expected.
Seoul, Taipei, Jakarta and Bangkok were well in positive territory but Sydney, Manila and Wellington were more than one per cent lower, while Singapore also dropped.
In early trade, London dipped as traders returned from a long weekend, though Paris and Frankfurt rose.
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 virus 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 at around US$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.”
The dollar was at its weakest level against the euro since May 2018 while sterling was around nine-month highs. Oil prices rallied more than one per cent, with the commodity helped by signs of a pick-up in US demand.
Key figures around 0810 GMT
Tokyo — Nikkei 225: FLAT at 23,138.07 (close)
Hong Kong — Hang Seng: FLAT at 25,184.85 (close)
Shanghai — Composite: UP 0.4 per cent at 3,410.61 (close)
London — FTSE 100: DOWN 0.1 per cent at 5,959.29
Euro/dollar: UP at US$1.1974 from US$1.1935 at 2045 GMT
Dollar/yen: DOWN at 105.75 yen from 105.89 yen
Pound/dollar: UP at US$1.3406 from US$1.3370
Euro/pound: UP at 89.32 pence from 89.26 pence
West Texas Intermediate: UP 1.1 per cent at US$43.08 per barrel
Brent North Sea crude: UP 1.2 per cent at US$45.80 per barrel
New York — Dow: DOWN 0.8 per cent at 28,430.05 (close) — AFP
