Two trends about Asia markets’ performance around the latest US Jobs data

Children play in front of a screen showing the China Composite Stock Price Index at a brokerage house in Qingdao in China's Shandong province Monday, Aug. 13, 2012. World stock markets fell Monday after a slowdown in Japan's growth gave investors another reason to worry about the health of the global economy. Asian stock markets closed mostly lower. (AP Photo) CHINA OUT

Asian markets delivered a subdued performance ahead of US Jobs data: Janet Yellen, the Chair of the Federal Reserve had few days ago indicated about a possible interest rate hike that could be on the cards this year. Given this view, Asian markets traded mixed last week ahead of the US jobs data release. Nikkei 225 (INDEXNIKKEI:NI225) increased over 3.5% last week (from August 29, 2016 till September 02 2016). SSE Composite Index (SHA:000001) slightly fell over 0.1% last week while FTSE 100 (INDEXFTSE: UKX) rose about 0.8%. Australia’s S&P/ASX 200 performed the worst on September 02, 2016 in the Asian market. On the same day, Gold was also flat at $1,314.20 an ounce while Brent crude was up 0.9% at $45.87 a barrel and West Texas Intermediate was 1% higher at $43.58.


S&P AUST INDEX ASX 200 INDEX XJO (Source: Financial Times)

Lower than estimated jobs data performance drove the Asian markets: The labor market data was not as expected wherein nonfarm payrolls came out lower-than-expected to 151,000 rise in August (against the consensus forecast rise of 180,000) with revisions to July and June at a net minus 1,000. This was way below the downwardly revised 271,000 increase of July. Nonetheless, the unemployment rate remained steady at 4.9% while earnings rose only 0.1% in the August month for a year-on-year plus 2.4% which is down a sizable 3 tenths from July. Even goods producing payrolls fell on the back of weakness in mining, construction and manufacturing. As a result, Asian markets rose post this data on hopes of change in interest rate related decision by federal reserve on the back of weak jobs data. FTSE 100 (INDEXFTSE: UKX) rose over 2.09% from September 02, 2016 till September 08, 2016. Nikkei 225 (INDEXNIKKEI: NI225) rose over 0.33% from September 02 till September 08, 2016 while SSE Composite Index (SHA:000001) rose over 1.07% during the same period.

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