Article / 07 August 2017 at 7:00 GMT

Morning Markets: Asia-Pac shares vault into new week

Consulting editor / TradingFloor
Norway







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Watchlist

  • South Africa: Gold and FX reserves (published)
  • Germany: Industrial production (published)
  • Switzerland: SNB foreign currency reserves (0700 GMT)
  • Switzerland: CPI (0715)
  • South Africa: Quarterly labour force survey (0730 GMT)
  • Eurozone: Sentix Investor Confidence Index (0830 GMT)
  • US: Labor Market Conditions Index (1400 GMT)


Asia-Pacific equities powered into the new week, with sentiment boosted by Friday's stronger-than-expected US nonfarm payrolls, which were seen as a case for the US Federal Reserve to stick to its tightening path though wage growth remains tepid.

A jump of as much as 7% in Chinese iron-ore prices lifted shares in Australian miners, including Rio Tinto, and Japanese carmakers were also among the gainers.

In Monday Asian trading, the US dollar drifted off highs that it hit on Friday on the back of the US July jobs report.

US crude oil prices rose on signs that the US rig count may have peaked.

Market signals

Asian session

  • Asia markets rose at the start as investors reacted to the strong nonfarm payroll number
  • Crude gained 1.1% in the US on signs the rig count has peaked
  • UN Security Council imposed new sanctions on North Korea on Saturday 
  • Opec is meeting this week in Abu Dhabi
  • Strong gains for spot iron ore lifted Australian miners
  • Chinese rebar steel futures have surged as much as 7% to their highest in four years 
  • Australia's AiG Construction Index surged to 60.5 points in July
  • The S&P/ASX200 rebounded from last week's slide

Forex ahead

  • Comments from Fed officials, CPI data, may prolong the rebound in USD
  • AUD gave up some of its recent gains; it was at 0.7941¢ in late Asian trade
  • Thursday's RBNZ Monetary policy statement could affect the lofty NZD

From the Floor

Solid.The US jobs report on Friday was solid -- good payrolls growth. Average hourly earnings did not decline as had been expected,” says Hardy.

Stellar. "Hong Kong is the best-performing market in 2017 -- the Hang Seng is up almost 28% in dollar terms," says Garnry. 

Get all the latest from Saxo Bank's trading floors in From the Floor, within the hour.

In opinion

1..2..3
Today’s data hint at softer numbers for Germany's industrial sector, but some analysts think the German economy is at risk of overheating, warns James Picerno.

USD corrects
The US dollar rallied against the majors after July US nonfarm payrolls beat expectations, but the move looks more like an overdue correction than a real trend change, writes Michael O'Neill.

Fragile kiwi
The New Zealand dollar finds the air a bit thin above 0.75 and will struggle to make any further upward progress, predicts Max McKegg

Shenanigans
As the Brexit debate and Trump shenanigans occupy centre stage, politics are now the core driver of FX markets, writes Neil Staines.


US Department of Labor

 Stronger-than-estimated US nonfarm jobs figures on Friday bolstered the 
beleaguered US dollar. Photo: Shutterstock

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