Markets Overview
- ASX SPI 200 futures down 0.1% to 8,541.00
- Dow Average down 0.3% to 42,319.74
- Aussie up 0.2% to 0.6506 per US$
- US 10-year yield rose 3.6bps to 4.3906%
- Australia 3-year bond yield rose 0.6 bps to 3.33%
- Australia 10-year bond yield little changed at 4.25%
- Gold spot down 0.6% to $3,352.91
- Brent futures up 0.6% to $65.23/bb
Economic Events
- 11:00: (AU) Australia to Sell A$800 Million 1.5% 2031 Bonds
- 16:30: (AU) May Foreign Reserves, prior A$102.4b
Asian equities were primed for losses on Friday, tracking falls on Wall Street ahead of US jobs data that may help identify the path ahead for Federal Reserve cuts.
Equity-index futures for Japanese and Australian equity indexes declined Friday, weighed down by lackluster sentiment in US trading that left the S&P 500 0.5% lower and the Nasdaq 100 down 0.8%. Treasuries also fell on Thursday, while contracts for US stocks slipped in early Asian trading on Friday.
Tesla Inc.’s shares slumped 14% on Thursday as President Donald Trump proposed ending Elon Musk’s government contracts and subsidies after his onetime adviser attacked the Republican tax-policy bill. Musk also said he would end the use of Space Exploration Technologies Corp.’s Dragon spacecraft and called for Trump’s impeachment.
The Tesla move weighed on US benchmarks in Thursday that had earlier risen as Trump and China’s Xi Jinping agreed to further trade talks. Trump said talks would begin shortly at a location to be determined as the countries aimed to resolve disputes over tariffs and rare earth minerals.
A gauge of US-listed Chinese stocks rose 0.5% Thursday and Hong Kong equity futures were fractionally higher early Friday, running against the broader mood.
The 10-year Treasury yield rose around four basis points to 4.39%, partly unwinding a rally from the prior session. An index of the dollar fell to touch the lowest level since July 2023.
Later Friday, nonfarm US payrolls are expected to show 125,000 new jobs were added to the economy in May after growth in March and April exceeded projections in a sign of economic vigor.
“Anything below the 100,000 mark could reignite recession fears while a stronger-than-expected print could perversely be negative for risk assets as it would likely put upward pressure on yields,” said Julien Lafargue, Chief Market Strategist at Barclays Private Bank.
Meanwhile, the Treasury Department declined to name any country a currency manipulator while singling China out for “its lack of transparency,” in a semiannual foreign-exchange report released Thursday. The last time the Treasury designated a country as a manipulator was in 2019, in Trump’s first term, when China got hit with the label. The tag was dropped five months later as a bilateral trade deal was negotiated.
In Asia, data set for release Friday includes an interest rate decision in India, household spending in Japan and inflation for Thailand and Vietnam. Markets are closed in South Korea, Indonesia and the Philippines.
Chinese ride-hailing leader Didi Global Inc. returned to profit in the March quarter, according to Thursday results, in a boost for the company as it gears up for a potential Hong Kong market debut. Elsewhere, Chinese officials summoned the heads of major electric vehicle makers, including BYD Co., to Beijing earlier this week to address concerns about the long-running price war, according to people familiar with the matter.
Commodities broadly held to muted moves. Gold was steady early Friday after a 0.6% decline Thursday. West Texas Intermediate, the US oil price, was slightly lower Friday after a gain in the prior session.
