Asian Stocks Swing as Investors Avoid Risk Before Payrolls Data

  • Investors await U.S non-farm payrolls data for Fed hints
  • Crude halts four-day declines as Russia proposes output freeze

Asian stocks fluctuated in a narrow range as investors avoided taking on risk before key U.S. payrolls data that may provide hints on the path of interest rates in the world’s largest economy.

The MSCI Asia Pacific Index was little changed as of 4:47 p.m. in Hong Kong as 50-day volatility dropped to the lowest since June 2015. The gauge of Asian companies has been in a holding pattern this week as investors turned their attention to the Friday payrolls data after Federal Reserve Chair Janet Yellen indicated the case for an interest-rate increase is getting stronger.

“All eyes are clearly focusing on the non-farm payrolls data,” James Woods, a strategist at Rivkin Securities in Sydney, said by phone. “Even if we do see a strong reading in the payrolls, I don’t really expect that the Fed would act in September. The recent data has been improving and its certainly a good sign but its not enough yet to suggest that they have to hike imminently.”

Weaker-than-forecast U.S. manufacturing data on Thursday raised concerns that the patchy growth in the economy may prompt the Fed to hold rates for longer. Odds that the Fed will boost rates in September have fallen to 34 percent from 42 percent at the end last week, while traders are betting there’s a 60 percent chance of tightening in December.

Japanese shares swung between gains and losses Friday before finishing higher to extend the week’s advance to 4.1 percent, their best performance since mid-July. Automakers and banks underpinned gains this week on the back of a weaker yen.

Hang Seng

Hong Kong’s Hang Seng Index advanced 0.5 percent to the highest in a year, capping a 1.6 percent gain for the week. CK Hutchinson Holdings Ltd. rose the most since September 2015 after gaining approval from the European Union to create Italy’s largest wireless provider. The Hang Seng China Enterprises Index of mainland shares listed in Hong Kong added 0.8 percent, taking this week’s advances to 1.4 percent.

Acer Inc. jumped 7.3 percent in Taipei, the most in the MSCI Asia Pacific Index, as the company unveiled a slew of new products at the IFA exhibition in Berlin. Taiwan’s Taiex index declined 0.2 percent. South Korea’s Kospi index gained 0.3 percent after the nation’s economy grew 0.8 percent in the second quarter, stronger than previously estimated. 

Thailand’s SET Index sank 1.2 percent and Singapore’s Straits Times Index fell 0.6 percent to a two-month low. Equity gauges in the Philippines, India and Indonesia climbed at least 0.3 percent.

Australia’s S&P/ASX 200 Index dropped 0.8 percent. Alumina Ltd. advanced 5.8 percent in Sydney after settling a dispute with its joint-venture partner Alcoa Inc., a move that may spur takeover interest in the Australian company. New Zealand’s S&P/NZX 50 Index closed little changed.

West Texas Intermediate crude halted four days of declines as Russian president Vladimir Putin said he would like the nation and OPEC to reach an output freeze while exempting Iran. Putin said he may recommend completing the plan when he meets with Saudi Arabia’s Deputy Crown Prince Mohammed bin Salman at the G20 summit.

Crude slumped 3.5 percent on Thursday after U.S. government data showed crude supplies at the highest seasonal level in more than 20 years. Putin’s comments come before OPEC members and other oil producers meet in Algiers later this month.

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