Asia stocks hesitant, dollar firms as US payrolls dent Fed rate cut wagers
Oil prices fell nearly 2% as Middle East tensions eased after Israel withdrew more soldiers from southern Gaza, while gold prices slumped 1% after scaling record high on Friday as U.S. Treasury yields remain elevated.
MSCI's broadest index of Asia-Pacific shares outside Japan was 0.26% higher, while Tokyo's Nikkei rose 1%.
China mainland stocks reopened after extended holidays from Thursday, with the blue-chip gauge 0.5% lower. Hong Kong's Hang Seng Index rose 0.33%.
Wall Street's main indexes closed higher on Friday after data showed U.S. job growth blew past expectations in March and wages increased at a steady clip, suggesting the economy ended the first quarter on solid ground.
«Resilient economic data are a double-edged sword for markets,» said ANZ strategists in a note. «On the positive side, resilient growth indicates an economy far from recession, but it could also mean the Fed will keep rates higher for longer.»
Markets are now pricing in 49.1% chance of an interest rate cut from the Fed in June, the CME FedWatch tool showed, with July shaping up to be the new starting point for the eagerly awaited easing cycle.
Investors are also pricing in 62 basis points of cuts this year, less than the 75 basis points the Fed has projected.
Investor focus this week will be squarely on the U.S. consumer price index (CPI) report, which is expected to show core inflation slowing to 3.7% in March from 3.8% the prior month.
The expected slip in core inflation is unlikely to bring back a possible June cut after last
