Markets Overview

  • ASX SPI 200 futures little changed at 8,256.00
  • Dow Average little changed at 42,196.52
  • Aussie little changed at 0.6886 per US$
  • US 10-year yield rose 5.1bps to 3.7828%
  • Australia 3-year bond yield fell 5.3 bps to 3.50%
  • Australia 10-year bond yield fell 5.5 bps to 3.95%
  • Gold spot down 0.2% to $2,658.98
  • Brent futures up 1.5% to $74.69/bbl

Economic Events

  • 09:00: (AU) Sept. Judo Bank Australia PMI Services, prior 50.6
  • 09:00: (AU) Sept. Judo Bank Australia PMI Composite, prior 49.8
  • 10:30: (AU) Australia to Sell A$1 Billion 161-Day Bills
  • 10:30: (AU) Australia to Sell A$1 Billion 70-Day Bills
  • 11:30: (AU) Aug. Exports MoM, prior 0.7%
  • 11:30: (AU) Aug. International Trade Balance, est. A$5.5b, prior A$6.01b
  • 11:30: (AU) Aug. Imports MoM, prior -0.8%

Japan stocks are set to rebound Thursday after the nation’s new prime minister dimmed hopes of another interest-rate hike. Treasuries slid and the dollar climbed on signals the US may slow its easing.

The yen suffered its worst day against the greenback since June 2022 after Shigeru Ishiba said the economy isn’t ready for another interest-rate hike. The currency was steady at around 146 per dollar Thursday, its weakest level in a month, after falling 2% in the prior session.

Futures contracts for Japanese stocks, which typically rise when the yen falls, climbed 2.5%. Contracts for Hong Kong and Australian equities were flat early Thursday, while S&P 500 futures edged higher after the index ended Wednesday little changed. A gauge of US-listed Chinese companies rose almost 5% after mainland stocks listed in Hong Kong jumped Wednesday.

Renewed vigor in the greenback added to the pressure on the Japanese currency as strong jobs data led traders to pare bets on aggressive Federal Reserve cuts. Swaps traders were penciling in some 33 basis points of policy easing at the central bank’s November meeting, down from 44 basis points just last week.

Oil rose for a third day in early Asian trading as investors await Israel’s response to Iran’s missile attack, with US President Joe Biden urging Israel to hold off from attacking Iran’s nuclear facilities.

An index of dollar strength rose on Wednesday as Treasury yields climbed. The 10-year yield rose five basis points to 3.78% after hitting a low of 3.69% in the prior session amid the flare-up of tensions in the Middle East.

Data Wednesday showed US companies added more jobs than expected last month, at odds with other indicators that show a cooling labor market. Friday’s nonfarm payrolls numbers will be the next critical gut check on the health of workers and the US economy.

“Today’s ADP employment number surprised to the upside, suggesting the labor market is bending but not breaking,” said Chris Larkin at E*Trade from Morgan Stanley. “Friday’s monthly jobs report will have the final word on the current jobs picture, and more than likely, on near-term market sentiment.”

In Asia, Bank of Japan official Asahi Noguchi is set to speak Thursday, while data set for release includes Singapore S&P Global PMI figures and Jibun Bank PMI composite data. Markets are closed in mainland China and South Korea.