Asian stocks drop as jobs data adds to case for Fed cuts: Markets wrap
Asian stocks slipped on Monday after US jobs data added to concerns that the Federal Reserve may have waited too long to cut interest rates.
Equities in Australia, Japan and South Korea racked up losses in early trading, while US futures were little changed. The dollar was steady against peers, with traders split on the size of the Fed’s easing next week. Iron ore fell below $90 a ton for the first time since late 2022.
Nonfarm payrolls data on Friday added to signs the US job market is losing steam, fueling debate over how much the Fed should cut interest rates. After the data was released, Fed Governor Christopher Waller said he was “open-minded” on the potential for a bigger rate cut.
“Asian stock markets, especially in tech-driven regions like Japan, Taiwan, and South Korea, are set to brace for a storm with their economies acutely sensitive to the brewing global downturn,” said Hebe Chen, an analyst at IG Markets Ltd. “If the dark clouds of a struggling US economy spread globally, risk-sensitive currencies like the Aussie could soon come under severe strain,” she said
Just before stocks opened in Tokyo on Monday, data showed that Japan’s economy expanded in the second quarter at a pace slightly slower than the government’s initial estimate. But it still advanced enough to keep the Bank of Japan on track to raise interest rates later this year. The yen was slightly weaker against the greenback early Monday, while the Nikkei 225 index slumped as much as 3%.
Chinese assets will be in focus as officials
