Asian Stocks Set to Advance on Growth Optimism: Markets Wrap

Asian stocks are poised to advance after American and Chinese economic data lifted equities on Wall Street and before U.S. jobs numbers ahead of a long weekend. The dollar slumped after Steven Mnuchin said a weaker currency is “somewhat better” for trade

Futures suggested higher opens for equity markets in Japan, Australia and South Korea after the MSCI Asia Pacific Index completed its eighth straight month of gains. The dollar declined on weak inflation data, while 10-year Treasury yields slipped to 2.12 percent. Gasoline continued its march upwards to its highest level in more than two years amid the impact of Harvey.

U.S. consumer spending increased by less than estimated in July, though rising incomes and an upward revision to June purchases put the economy on a stable footing for the second half. The focus now turns to jobs data on Friday for more clarity on the next move in interest rates after the core PCE deflator — the Federal Reserve’s preferred inflation gauge — slowed, another sign of benign price pressures, while GDP and jobs growth remain robust.

In Asia, the market will be parsing Caixin’s China PMI for whether the official figure’s unexpectedly robust growth reflects the whole manufacturing economy. The measure is expected to drop to 51 in August from 51.1.

Terminal subscribers can read more on our Markets Live blog.

Among other key events this week:

  • Various Asia PMIs, also those for Germany, France U.K. and the euro zone ahead of the ECB rates decision next week.
  • Japan capital spending is due Friday as well as South Korea trade, GDP and CPI data.
  • U.S. non-farm payrolls data for August is due Friday, along with unemployment and earnings numbers, and the Markit U.S. PMI.
  • Singapore and Malaysia are closed for holidays.

And here are the main moves in markets:

  • Futures on the Nikkei 225 Stock Average advanced less than 0.1 percent as of 7:21 a.m. Tokyo time and they were up 0.2 percent on the Kospi index in South Korea and 0.1 percent higher on Australia’s main gauge.
  • Contracts on the S&P 500 were little changed after the underlying measure rose 0.6 percent.
  • The yen was steady at 109.95 per dollar, holding on to an 0.2 percent gain.
  • The Bloomberg Dollar Spot Index fell 0.2 percent.
  • The euro climbed to $1.1921, near the strongest since 2015.
  • The yield on 10-year Treasuries slipped to 2.12 percent. It fell 17 basis points in the month.
  • Gold was little changed at $1,321.32 an ounce after capping its best month since January.
  • West Texas Intermediate crude fell 0.4 percent to $47.04 a barrel, trimming a 2.8 percent rally.
  • Gasoline for September advanced for an eighth day, up 14 percent to $2.1399 a gallon. Earlier, the front-month contract touched the highest since July 2015.

— With assistance by Robert Brand, and Jeremy Herron

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