Asian Shares Mixed; U.S. Futures Rise, CPI Data Key This Week

08/12/2021 Shares in Asia-pacific lagged U.S. and European futures on Monday with markets participants weighing the latest on the omicron variant and the regulatory outlook for Chinese technology companies. In early trade, the MSCI’s average index of Asia-Pacific ex. Japan was last inching down 0.44%; with benchmarks in Australia and Japan seeing modest declines, while Hong Kong retreated for a third day. Tencent shares pulling back -2.46%. Shares in China rose amid bets the central bank might soon ease monetary policy to aid growth. Treasury yields rose, trimming Friday’s plunge that sent the 10-year yield closer to 1.30%.

Oil prices bounced after Saudi Arabia raised prices for its crude sold to Asia and the United States for January, and as indirect U.S.-Iran talks on reviving a nuclear deal appeared to hit an impasse. Brent crude futures climbed $1.49, or 2.13%, to $71.34 a barrel, while U.S. crude added $1.46, or 2.22%, to $67.73 per barrel.

Gold held onto Friday’s gain, amid risk-off sentiment as investors weigh mixed labour data from the U.S., the Federal Reserve’s hawkish tilt and the threat of the omicron variant.

Bitcoin shed a 20% of its value on Saturday as profit-taking and macro-economic concerns triggered nearly $1 billion worth of selling across cryptocurrencies. Bitcoin was last at $48,954, having been as low as $41,967 over the weekend.

Here are some key events to watch this week:
• Reserve Bank of Australia policy decision Tuesday
• Euro zone GDP Tuesday
• Olaf Scholz set to replace Angela Merkel as chancellor Wednesday
• European Central Bank President Christine Lagarde speaks at a conference Wednesday
• Reserve Bank of Australia Governor Philip Lowe speaks Thursday
• China CPI, PPI, money supply, new yuan loans, aggregate financing Thursday
• U.S. CPI Friday

Locally, the local bourse closed weak on Friday amid disappointing U.S jobs data weighing on sentiment. The All-share index reversed its gains after data showed slower-than-expected job creation. Nonfarm payrolls increased by just 210,000 for the month of November, well below the anticipated gain of 550,000 predicted by economists. The JSE lost 0.3% to 70,807 points and the Top-40 0.39%. Industrial metals fell 2.36%, resources 1.56% and precious metals 0.25%. The rand fell along with other emerging market currencies, and currently steady at R16.06/$. Top-40 futures are +119 points firm this morning, taking cue from U.S and European counterparts.

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Shares in Europe are set to start the day on Monday on an upbeat tone as the FTSE100 futures are currently +63 points firm, the DAX futures gaining +150points, alongside the CAC-40 advancing +80 points.
European markets finished the week on a down note on Friday, weighed down by concern about the prospect for faster than expected interest rate hikes across the continent and a much weaker than expected reading on the US jobs market for November. The pan-European Stoxx 600 index gave back 0.57%, alongside a 0.61% decline for the German Dax, while the FTSE100 dipped 0.10%.

Wall Street took a tumble on Friday, with technology stocks among the worst performers, as a mixed set of job figures failed to calm markets agitated by the omicron virus variant and a hawkish pivot by the Federal Reserve. Friday’s primary focus was be the November jobs report, which revealed the US economy added fewer jobs than expected throughout November, indicating that hiring had already started to slow before the emergence of the Covid-19 omicron variant. The Dow Jones Industrial Average was down 0.17%, while the S&P 500 was 0.84% weaker and the Nasdaq Composite came out the gate 1.92% softer. U.S. futures in positive territory , green across the board: Dow futures +238 points, or 0..69%, the S&P500 futures 0.51%, alongside Nasdaq futures 0.13%.

China Evergrande Group is again on the brink of default, with pessimistic comments from the property developer raising expectations of direct state involvement and a managed debt restructuring.
Evergrande will again face the end of a 30-day grace period on Monday, with dues this time at $82.5 million – the stock tumbled 12% to an 11 year low.

Hong Kong’s Hang Seng retreating 1.24% as China’s securities watchdog on Sunday tried to play down fears over Chinese companies’ withdrawal from American exchanges. Alibaba to overhaul e-commerce businesses, names new CFO. Benchmarks in China in good territory, with the blue-chip CSI300 up 0.47% and the Shanghai Composite firm 0.25%.

Japan’s 10-year government bond yields fell on Monday, tracking a tumble in U.S. 10-year Treasury yields as uncertainty over the Omicron coronavirus variant dampened risk sentiment. Japan’s Nikkei225 pulling back 0.30%. Shares in Australia steady, with the S&P/ASX200 marginally up 0.05%.