Mon, October 03, 2022

Markets eye US jobs; stocks dip, while oil sharply fell

Mainland Chinese stocks on Thursday

Stocks and emerging markets currencies declined on Friday. Meanwhile, oil headed for its biggest weekly slump since March. Remarkably, concerns over the spread of the Delta strain of the COVID-19 hit risk assets and crimped demand.

Key jobs report due later on August 6 is anticipated to deliver further signs of growth in the U.S. It is soothing some of those worries about the global economy and further increasing the dollar.

The benchmark STOXX index of European shares dropped 0.1%. Moreover, MSCI’s broadest index of Asia-Pacific shares excluding Japan also fell. It came as Chinese blue chips faced uncertainty over government policy.

Moreover, the Thai baht led to losses among emerging markets currencies, emblematic of how a rise in COVID-19 cases and deaths in some countries worldwide is hitting confidence in their currencies and economies.

On Friday, the Asian giant China reported 124 confirmed cases for August 5. Remarkably, it is the highest daily number of new COVID-19 infections in the current outbreak, fed by a spike in locally transmitted infections. The Chinese government have imposed travel restrictions in some cities.

Thailand and Malaysia both reported record daily infections on Thursday.

U.S. stock futures dropped by 0.05% after the S&P 500 closed at record levels

According to Bank of America, the Delta strains exposed the vulnerability of Asian economies as the overall vaccination rate is low in Asia.

This is reducing shares in Asia. Meanwhile, the MSCI Asian benchmark gained 1.6% this week. However, it is still down just over 10% from the all-time highs hit in February.

Meanwhile, the MSCI world shares index is close to a lifetime high, which it hit on Wednesday.

Remarkably, U.S. stock futures, dropped by 0.05% on Friday after the S&P 500 closed at record levels. The S&P 500 surged the day before after a spate of solid corporate earnings and a further slump in U.S. jobless claims.

Investors expect July employment data, which is due today and is anticipated to show robust gains, albeit partly due to seasonal technical factors as much as underlying growth.

Moreover, Treasury yields extended their gains, having earlier been supported by the healthy jobless claims report.

Benchmark 10-year Treasury note yields increased to 1.2432%, approaching a week high.

Oil prices surged on Friday but were still set for their biggest weekly loss since October after declines earlier in the week due to increasing COVID-19 infections and a surprise build in U.S. crude stockpiles.

U.S. crude surged 0.47% to settle at $69.5 a barrel. Brent crude gained 0.66% to $71.76 per barrel.

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