Asia stocks poised for rise as Wall Street gains, Fed maintains rate hold stance. Yen strengthens to 155.81 per dollar; oil rises near US$92 a barrel.
(Sept 4) : Stocks in Asia were poised to rise Friday, tracking gains on Wall Street as investors pared bets on a Federal Reserve rate hike this month. The yen held its biggest gain in over a month and oil rose.
Equity-index futures for Japan, South Korea and Australia pointed higher after Fed Governor Christopher Waller said he would support keeping rates steady if price pressures continue to ease. The dollar fell to its lowest since May, while swaps priced roughly even odds of a quarter-point hike in September, down from about 70% earlier this week. The two-year Treasury yield fell three basis points to 4.34%.
US stock futures were little changed after the S&P 500 posted its best session in a month, led by megacap shares, while the Nasdaq 100 climbed 1.2%. Bitcoin topped US$80,000, US oil rose close to US$92 a barrel in early Friday trading, while gold was steady after rising the most in two weeks.
The repricing leaves the next batch of inflation data as the key test for the Fed’s September decision, with markets increasingly leaning toward a hold while remaining exposed to a reversal if price pressures prove stickier than expected.
“If there is continued progress toward our 2% goal, then I am willing to support holding the policy rate at its current level,” Waller said Thursday at an event hosted by Reuters. “But if inflation comes in hot, I would consider a rate hike.”
Thursday’s data offered a mixed picture. Initial jobless claims for the week through Aug. 29 were broadly in line with estimates, while the US services sector expanded in August at the fastest pace in six months, helped by stronger demand and a pickup in business activity.
Investors now turn to Friday’s jobs report for further clues on the Fed’s path. Economists expect US employers added 55,000 jobs in August, roughly in line with the average monthly gain this year.
Oil rose as Iran claimed fresh strikes on US bases, while Saudi Arabia’s smaller-than-expected increase in its flagship crude prices helped offset some concern about tighter supplies.
In Asia, the yen strengthened 2% Thursday, reversing a monthlong decline as traders boosted bets on Bank of Japan rate hikes and remained alert to the possibility of official intervention. The currency advanced to 155.81 per dollar in New York trading, wrapping up its best day since Tokyo and Washington entered the market to prop up the yen just over a month ago.
