Asian shares were cautiously higher on Thursday, while the dollar weakened ahead of US nonfarm payrolls data and oil prices rose for a fourth straight day after OPEC+ members pledged to cut production.
MSCI’s broadest Asia-Pacific shares outside Japan index rose 0.4% in early Asian trade as US futures rose. The index rose 4% this week after falling 13% in September. Japan’s Nikkei rose 0.7% to its highest level since September, South Korea gained 1.2%, and Australia gained 0.1%. On the other hand, Hong Kong’s Hang Seng lost 0.5%.
S&P 500 futures rose 0.6%, and Nasdaq futures rose 0.9%, helped by a late rebound in US stocks that helped limit earlier losses. The S&P 500 closed 0.2% on Wednesday, while the Nasdaq Composite closed 0.25%. Markets in mainland China were closed for a holiday.
The Refinitiv Asia energy index rose 0.7% as the Organisation of the Petroleum Exporting Countries, and its allies agreed to cut oil production since the start of the COVID-19 pandemic, dampening supply in an already tight market.
Oil prices rose for a fourth straight day to their highest level since mid-September. Brent crude futures rose 0.6% to $93.9 a barrel, while US West Texas Intermediate (WTI) crude futures rose 0.6% to $88.26 a barrel.
Earlier this week, US economic data showed the labour market and economy were slowing. The Reserve Bank of Australia unexpectedly raised rates by just 25 basis points, stoking hopes that the central bank won’t be aggressively raising rates and boosting risk sentiment.
But those hopes were dashed after a slightly higher-than-expected report from the Institute for Supply Management showed a rebound in US services employment.
US nonfarm payrolls data will be released on Friday, with economists polled by Reuters expecting 250,000 new jobs last month and an unemployment rate of 3.7%.
Overnight, San Francisco Fed President Mary Daly underscored the Fed’s commitment to curb inflation by raising interest rates further, although she also said the central bank wouldn’t simply move forward if the economy starts to collapse.
In foreign exchange markets, the dollar fell 0.2% against a basket of major currencies on Thursday after rising 0.7% overnight on hawkish comments from Fed officials.
US Treasury yields were largely steady after rising overnight. The yield on the benchmark 10-year Treasury note fell two basis points to 3.7368%, while the yield on the two-year note was steady at 3.7388%. Gold is slightly higher. Spot gold was trading at $1,719.49 an ounce.
