Asian stock markets rallied yesterday and the dollar dipped after a slowdown in US job creation dimmed expectations of an interest rate rise this month but also showed the economy still improving.
The much-anticipated reading on Friday showing 151,000 new posts in August was below expectations but indicated hiring remained solid.
Before its release analysts had seen the reading as a guide to the Federal Reserve’s plans after its boss Janet Yellen — and later her vice chairman Stanley Fischer — suggested a rate rise could come this year.
While most market-watchers suggested the below-par reading would likely mean no increase this month, there are still some who think a hike could come soon.
“Markets hardly took it as a bad number, with conjecture from both sides of the fence on what it means for the Fed,” Cameron Bagrie, chief economist in Wellington at ANZ Bank New Zealand, said in a research note.
“Our take is that the (Fed policy committee) will continue to proceed cautiously, with a September rate hike a tad early.”
In afternoon trade the yen edged up against the dollar after Bank of Japan head Haruhiko Kuroda left markets guessing about his plans for monetary policy at this month’s board meeting.
The gathering is being closely watched by markets hoping the bank will unveil fresh easing measures to kickstart the economy.
But while Kuroda repeated a pledge at a business seminar to unleash fresh measures if necessary — and waved off talk of scaling back on measures already in place — he gave few firm hints about the BoJ’s plans.
“While Kuroda denied any speculation about tapering, he spurred some disappointment for those looking for clear clues on policy action this month,” Yousuke Hosokawa, head of foreign exchange sales at Sumitomo Mitsui Trust Bank, told Bloomberg News.
The greenback fell to ¥103.40 in Tokyo, from ¥103.99 in New York.
The initially weaker yen lifted Japanese stocks more than 1% in early trade but its strengthening through the day weighed on exporters and the Nikkei ended just 0.7% higher.
Hong Kong added 1.7% while Shanghai ended up 0.2%. Sydney was 0.9% up by the close, Singapore climbed 1.3% and Taipei put on 1.1%.
There were also gains in Wellington and Jakarta.
In Seoul the KOSPI rose 1.1% but South Korea’s biggest shipping firm Hanjin slumped 30% at the open as its stock began trading again after being suspended as it filed for bankruptcy protection.
It bounced back on bargain-buying almost immediately but still finished nearly 14% lower. The company is groaning under debts estimated at more than $5bn, the victim of a long-running downturn in the shipping industry caused by a struggling global economy.
The dollar dipped against higher-yielding currencies, with South Korea’s won climbing almost 1%, while the Indonesian rupiah and Malaysian ringgit were also sharply higher.
In Tokyo, the Nikkei 225 up 0.7% at 17,037.63 points; Shanghai — Composite up 0.2% at 3,072.10 points and Hong Kong — Hang Seng up 1.7% at 23,649.55 points at the close yesterday.