Asian stocks shake off early blues

Asian stocks shake off early blues

SYDNEY - Asian stocks steadied on Friday as Hong Kong shares rebounded from multi-month lows but they were still on track for a fourth straight week of losses amid worries about global growth.

Uncertainty about US nonfarm payrolls data due later in the day contributed to a volatile session as did lower volumes with several major centers, including India and China, shut for public holidays.

German markets are closed for a holiday as well, but other European bourses looked set to rebound after Thursday's sharp drop.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.66 per cent, but is still down more than 1 per cent so far this week. It has fallen about 7.8 per cent in the last four weeks, marking its worst performance in over a year.

Tokyo's Nikkei climbed 0.3 per cent, while Australia's S&P/ASX 200 index gained 0.4 per cent. Hong Kong's Hang Seng rose 0.8 per cent, turning around from a fall of more than 1 per cent earlier in the session.

"As we went into today, there was a risk this was going to happen. Traders were saying there was a bit of value in the market...today calmer heads prevailed," said Chris Weston, chief market strategist at IG.

The rebound in Asian stocks came even after the European Central Bank disappointed investors on Thursday by giving no hints of an imminent sovereign bond buying programme.

Markets were further underwhelmed on Friday after a survey showed growth in China's services sector eased last month.

Growth worries particularly in the euro zone and China, geo-political risks as well as concerns about the effects of the Federal Reserve unwinding its massive stimulus have all conspired to unsettle global equity markets in recent weeks.

They have also driven the US dollar to a four-year high against a basket of major currencies as markets bet the Federal Reserve will hike interest rates well before the ECB and Bank of Japan.

The dollar index was last at 85.793, not far from the peak of 86.218 set earlier in the week. Against the yen, the dollar fetched 108.92, having reached a 6-year high of 110.09 on Wednesday. The euro traded at $1.2647, near a two-year trough of $1.2571 plumbed on Tuesday.

Dollar bulls are counting on the US jobs report to show employers stepped up hiring in September. Economists polled by Reuters expect payrolls rose by 215,000, up from a disappointing 142,000 in August. The jobless rate is seen staying at 6.1 per cent.

Any disappointment in the numbers, due at 1230 GMT, could prompt investors to take profits on long dollar positions.

Investors were also keeping a wary eye on developments in Hong Kong, whose leader Leung Chun-ying defied pro-democracy protesters' demands to step down by Friday.

Leung repeated police warnings that the consequences would be serious if protesters sought to surround or occupy government buildings.

However, Chief Secretary Carrie Lam is to hold a meeting with students soon to discuss political reforms, although no timeframe has been announced.

The combination of growth worries, geopolitical risks and a stronger US dollar have taken a toll on commodity prices.

Copper traded at $6,653 a tone, having plumbed a five-month low of $6,600 overnight. Oil prices wallowed at two-year lows, with Brent crude at $93.81 a barrel.

Purchase this article for republication.

BRANDINSIDER

SPONSORED

Most Read

Your daily good stuff - AsiaOne stories delivered straight to your inbox
By signing up, you agree to our Privacy policy and Terms and Conditions.