Asian markets mixed as investors eye U.S. jobs report

Asian markets mixed as investors eye U.S. jobs report

Most Asian shares declined, dragged down by tech stocks on Wall Street. Benchmarks fell in Tokyo, Seoul, Shanghai and Hong Kong but rose in Sydney.

Traders are watching this week’s U.S. monthly jobs report. Unemployment data announced Thursday was encouraging as job growth in May is expected to be more than double the pace of April.

However, investors are keeping a close eye on signs of inflation, which especially hurts the tech sector. The benchmark S&P 500 index dropped 0.4% on Thursday and is on track for a 0.3% weekly loss.

Japan’s benchmark Nikkei 225 slipped 0.4%. South Korea’s Kospi lost 0.2%, while Australia’s S&P/ASX 200 edged up 0.3%. Hong Kong’s Hang Seng rose 0.2% and the Shanghai Composite advanced 0.1%. Stocks fell in SIngapore, Taiwan and Indonesia.

On Thursday, technology companies, whose pricey valuations make them more sensitive to inflation fears, were the biggest weight on the market.

The S&P 500  fell 15.27 points, or 0.36% to 4,192.85. The Dow Jones Industrial Average fell 23.34 points, or 0.1%, to 34,577.04. The Nasdaq fell 141.82 points, or 1%, to 13,614.51.

The jobs report Friday should provide some insight, especially if the report shows significantly more jobs were created than the 650,000 expected by economists.

Rising inflation is expected as the economy recovers from the pandemic’s impact, but the key question for many on Wall Street is whether it will be temporary or more permanent.

The concern is that the global recovery could be hampered if governments and central banks have to withdraw stimulus to combat rising prices.

Damon Harrison
Market Analyst, IPG Group