Markets Overview
- ASX SPI 200 futures down 0.4% to 8,587.00
- Dow Average down 1.2% to 43,588.58
- Aussie up 0.7% to 0.6470 per US$
- US 10-year yield fell 15.8bps to 4.2159%
- Australia 3-year bond yield rose 4.5 bps to 3.46%
- Australia 10-year bond yield rose 5.4 bps to 4.32%
- Gold spot up 2.2% to $3,363.48
- Brent futures down 2.8% to $69.67/bbl
Economic Events
- 11:00: (AU) July Melbourne Institute Inflation, prior 0.1%
- 11:00: (AU) July Melbourne Institute Inflation, prior 2.4%
Asian stocks are poised to slip Monday after soft US jobs data dragged Wall Street lower and fueled bets on a Fed rate cut next month, sending Treasuries surging. Oil retreated as OPEC+ wrapped up a run of major output hikes.
Contracts for equity index futures in Japan, Australia and Hong Kong all pointed to losses early Monday, with Tokyo contracts down more than 2%. The moves signal that Friday’s sharp retreat from risk assets — driven by rising US unemployment and slower job creation — is rippling across global markets.
The S&P 500 ended Friday 1.6% lower and the tech-heavy Nasdaq 100 dropped 2%, the biggest one-day declines in months for the two benchmarks. Futures contracts for the two indexes were little changed early Monday.
Oil was down 0.6% early Monday after OPEC+ agreed to sharply hike production again in September to finish unwinding its latest tranche of supply cuts. The dollar was mixed against its Group of 10 peers after a gauge of the greenback slumped 0.9% Friday as Treasury yields fell.
The US 10-year yield dropped 16 basis points Friday while policy-sensitive two-year yields fell 28 basis points. The sharp declines reflected heightened anticipation the Fed will cut interest rates in its September meeting after holding borrowing costs steady last week.
Following the jobs data, some market-watchers are even anticipating the Fed may cut rates by 50 basis points, twice the regular amount.
“September is a lock for a rate cut — and it might even be a 50-basis point move to make up the lost time,” said Jamie Cox at Harris Financial Group.
In Asia, Thai Prime Minister Paetongtarn Shinawatra faces a deadline set by the Constitutional Court to submit her defense in an ethics case.
Elsewhere, the Bank of England is expected to cut interest rates later Monday.
President Luiz Inacio Lula da Silva said Brazil is open to trade talks with Donald Trump but only if his country is treated as an equal to the US. In India, Trump comments about the economy and Washington’s 25% tariff rate unveiled last week has caused shock.
The US leader has also threatened to pile an additional 40% tariff on any product that Washington determines to be “transshipped” through another country.
Gold was little changed after climbing Friday as Trump said the US is moving two nuclear submarines to respond to “provocative” statements from former Russian President Dmitry Medvedev.
Trump told officials to fire Erika McEntarfer, the commissioner of the Bureau of Labor Statistics, hours after the US jobs report was published Friday. He also said Fed Chair Jerome Powell should be put “out to pasture” and called on the central bank’s board to “assume control” if rates were not lowered.
