Asian stocks mixed, dollar rises ahead of megacap gains, jobs data By Reuters
Written by Kevin Buckland
TOKYO (Reuters) – Asian shares were mixed in volatile trading on Tuesday as investors braced for three days of high tech megacap earnings reports on Wall Street, starting with Google parent Alphabet (NASDAQ: ) later in the day.
The dollar fell well short of a three-month high with one of the Federal Reserve’s preferred employment measures – the JOLTS job openings report – due on Tuesday, ahead of the highly anticipated monthly non-farm payrolls data on Friday. US Treasury yields fell from a three-month high.
The yen found its footing following Monday’s three-month low as the coalition government’s violence in the weekend election clouded the outlook for Japan’s monetary and fiscal policies. The index recovered from a cautious start to build on the previous session’s gains.
The US election has entered the final stages, as opinion polls are still too close to call a winner, despite some betting sites and financial markets leaning on the victory of Democrat Donald Trump over Democrat Kamala Harris.
Corruption rose slightly following its entry on Monday in signs that the war in the Middle East would not spread, after Israel avoided targeting oil and nuclear facilities in a retaliatory strike on Iran over the weekend.
The Nikkei was up 0.65% as of 0213 GMT, building on its 1.82% rally in the previous session. It started the day down 0.21%.
Hong Kong’s was 0.65% higher, paring earlier gains of as much as 1.6%. Mainland China chips fell 0.1%, leaving an early rise of 0.68%.
The US was lower after the currency index gained 0.26% overnight.
“The case for taking these markets higher, we don’t have that,” said Tony Sycamore, a market analyst at IG. “We’re in a very difficult time here. It doesn’t make sense to take risks at this time.”
Many of the “Magnificent Seven” group of megacap technology stocks that have driven Wall Street to record highs this year are reporting financial results this week, starting with Alphabet. Earnings from Meta Platforms (NASDAQ: ) and Microsoft (NASDAQ: ) will be paid on Wednesday, followed by Apple (NASDAQ: ) and Amazon (NASDAQ: ) on Thursday.
The dollar was little changed against a basket of six major peers, including the yen and the euro. The figure stood at 104.24, after reaching 104.57 overnight, matching the highest level since Wednesday of last week, a level not seen since July 30.
Recent strong US economic data, including evidence of a firmer jobs market, has seen bets reversed for a rate cut this year by the Federal Reserve, boosting the dollar.
The US currency was also boosted by rising market expectations of Trump’s election victory, whose tax rates, tariffs and immigration policies are seen as inflationary, thus negative for bonds and the dollar.
The ten-year US Treasury yield fell to 4.272% on Tuesday, after reaching its highest level since July 11 at 4.3% overnight.
The dollar fell 0.24% to 152.92 yen, but that followed its highest rally since July 31 at 153.885 yen on Monday.
In Japan, a scramble to find a coalition is possible after Prime Minister Shigeru Ishiba’s Liberal Democratic Party and his junior ally Komeito lost their majority in parliament, a devastating outcome that could mean massive spending and complicate the Bank of Japan’s push to adjust interest rates.
The head of the opposition Democratic Party for the People said on Tuesday that the central bank should avoid making major changes to its current loose monetary policy because real wage growth has stagnated.
The BOJ next decides on policy on Thursday, with no change expected.
The euro held firm at $1.0814, while sterling was lower at $1.2973.
Gold rose 0.35% to $2,751.76 an ounce, up from a record high of $2,758.37 from last week.
Futures gained 0.6% to $71.86 a barrel, while US West Texas Intermediate crude was at $67.83 a barrel, up 0.7%. Both contracts fell 6% on Monday, their biggest drop since Oct. 1.
