Hong Kong — Asian markets were mixed on Thursday, following a global selloff the day before. On Wall Street, technology, energy and other sectors were down.
Japan’s benchmark Nikkei 225 index closed down 0.9% at 36,700.19 in morning trading.
Data released Thursday showed Japan’s wage growth remains strong, with average cash earnings rising 3.6% year-on-year in July, beating market expectations, and real earnings unexpectedly rising 0.4% in July, raising the prospects of another rate hike.
The US dollar traded at 143.81 yen, boosted by strong data.
“If global markets remain in risk-off mode (particularly in commodities such as crude oil), the Fed could be pressured to cut rates by as much as 50 basis points. This would be driven by easing inflation risks, which could send USD/JPY further south,” SPI Asset Management’s Stephen Innes said in a commentary.
South Korea’s Kospi fell less than 0.1% to 2,579.93, as the country’s economy is estimated to have shrunk by 0.2% in the second quarter.
Hong Kong’s Hang Seng Index fell 0.4% to 17,379.83, while the Shanghai Composite Index rose 0.1% to 2,785.38.
S in Australia&The P/ASX 200 rose 0.1% to 7,957.40.
U.S. futures prices fell while crude oil prices rose.
S on Wednesday&The S&P 500 fell 0.2% to 5,520.07. The Nasdaq Composite fell 0.3% to 17,084.30. However, the Dow Jones Industrial Average rose 0.1% to 40,974.97.
The recent market decline came after a government report showed an unexpected decline in job openings in the U.S. in July, a sign that hiring could slow in the coming months.
The Labor Department reported 7.7 million job openings in July, down from 7.9 million in June and the lowest number since January 2021. The vacancies have steadily declined from about 8.8 million in January of this year. But overall, the report was mixed, with hiring increasing last month.
Several other reports coming out this week will help paint a clearer picture of the economic situation at the Federal Reserve and on Wall Street.
The Institute for Supply Management is scheduled to release its August service sector index on Thursday. The services sector is the largest component of the U.S. economy.
The U.S. is due to release its monthly jobs report for August on Friday. Economists surveyed by FactSet expect the report to show the U.S. adding 160,000 jobs, up from 114,000 in July, and the unemployment rate falling to 4.2% from 4.3%. The strength or weakness of the report will likely influence the Fed’s plans for how to cut interest rates.
Traders expect the Fed to cut rates by 1% by the end of 2024. For that to happen, the Fed would have to cut rates by at least the traditional 0.25% point at one of its meetings in the coming months.
In the bond market, the 10-year Treasury yield fell to 3.76% from 3.83% late Tuesday, down from 4.70% in late April, a big drop for the bond market. The 2-year Treasury yield, which tracks potential Fed action more closely, fell to 3.76% from 3.87%.
The 10-year Treasury and 2-year Treasury are at their lowest inversion levels in more than two years. An inversion occurs when shorter-term yields are higher than longer-term yields. While it has historically signaled a recession, the current inversion has lasted more than two years in a growing economy.
In energy trading, benchmark U.S. crude rose 14 cents to $69.34 a barrel. International standard Brent crude rose 12 cents to $72.82 a barrel.
In forex trading, the euro fell from $1.1082 to $1.1077.
