Asia report: Markets mostly higher as investors look for Fed clues

Most markets in Asia were in the green on Friday, as investors continued to look across the Pacific for clues on the prospect of Federal Reserve interest rate cuts, which were due to come in the form on nonfarm payrolls later in the global day.

In Japan, the Nikkei 225 was up 0.2% at 21,746.38, as the yen weakened 0.19% against the dollar to last trade at JPY 108.03.

Of the major components on the benchmark index, automation specialist Fanuc was up 1.31%, while fashion firm Fast Retailing lost 0.11% and technology conglomerate SoftBank Group slid 1.38%.

The broader Topix index was up 0.18% in Tokyo, to finish its trading day at 1.592.58.

On the mainland, the Shanghai Composite was 0.19% firmer at 3,011.06, and the smaller, technology-heavy Shenzhen Composite gained 0.63% to 1,601.20.

South Korea’s Kospi was 0.09% higher at 2,110.59, while the Hang Seng Index in Hong Kong slipped 0.07% to settle at 28,774.83.

Both of the blue-chip technology stocks were in the red in Seoul, with Samsung Electronics down 0.76% and chipmaker SK Hynix falling 2.56%.

Samsung’s shares were in the red after the company reported that it was expecting second-quarter profit to fall 56% year-on-year.

Sentiment was muted for much of the Asian day, as investors looked towards the nonfarm payrolls report in the US as the next clue in the puzzle of solving what the Federal Reserve will do next.

Economists polled by Reuters were expecting private employment to have jumped by 153,000 in June, which would be a large improvement from the 90,000 figure in May.

Total nonfarm employment was anticipated to have grown by 160,000.

Market watchers were looking for a weaker-than-expected reading as a further signal that the Fed could cut interest rates at its July policy meeting, the central bank having opened the door to such easing with its rhetoric in June.

The ADP National Employment Report, released on Wednesday, suggested 102,000 private jobs were added to the US economy in June - far short of the 140,000 analysts were anticipating.

“The weak ADP data whispers that the US nonfarm payrolls could fall short,” said London Capital Group senior market analyst Ipek Ozkardeskaya.

“But the US unemployment rate probably remained unchanged at 3.6%, a fifty-year low, despite the slowing economic activity and waning inflation amid the ongoing trade tensions with China.”

Oil prices were lower as the region entered the weekend, with Brent crude last down 0.17% at $63.19 per barrel, and West Texas Intermediate off 0.57% at $56.48.

In Australia, the S&P/ASX 200 rose 0.5% to 6,751.30, with most of the subindices on the Sydney benchmark ending the day in the green.

Across the Tasman Sea, New Zealand’s S&P/NZX 50 was up 0.5% at 10,615.47, led higher by units in the Fonterra Shareholders’ Fund, which was up 3.7% after sliding more than 5% on Thursday.

The fund is an instrument which allows trading in the country’s largest company - Fonterra - which is a dairy cooperative owned by its supplier farmers.

Both of the down under dollars were weaker on the greenback, with the Aussie last off 0.06% at AUD 1.4247, and the Kiwi retreating 0.26% to NZD 1.4992.