MSCI’s broadest index of Asia-Pacific shares outside Japan advanced 0.8%, after gaining 1.1% last week
Asian shares were slightly higher on Monday, while the dollar and bond yields were on the wane ahead of inflation data that investors hope will pave the way for rate cuts in the US and Europe.
Oil prices jumped 0.8% amid the conflict in the Middle East, stirring worries about possible supply disruptions if the conflict escalated.
Brent gained 55 cents to $79.57 a barrel, while U.S. crude advanced 56 cents to $75.39 per barrel.
Investors are also awaiting earnings from AI company Nvidia on Wednesday to see if it can match the market’s high expectations.
The stock is nearly 150% higher year-to-date, accounting for around a quarter of the S&P 500’s 17% year-to-date gain.
Nvidia will beat consensus expectations, they always do, but investors are so ingrained in seeing revenue come in $2 billion plus above the analysts’ consensus or we could easily see a sell the news event, according to Chris Weston, head of research at broker Pepperstone.
That means Nvidia would have to report sales of $30 billion or more and guidance for Q3 of $33 billion or above, he said.
On Monday, S&P 500 futures and Nasdaq futures were stable after starting a slightly down.
EUROSTOXX 50 futures slipped 0.2%, while FTSE futures were closed for a holiday.
MSCI’s broadest index of Asia-Pacific shares outside Japan advanced 0.8%, after gaining 1.1% last week, while South Korea was barely changed. Chinese blue chips were also near flat.
Japan’s Nikkei skidded 1.0% as a stronger yen pressured exporter stocks.
The yen has climbed on a broadly weaker dollar after Fed Chair Jerome Powell said the time had come to start easing policy and emphasised that the central bank did not want to see further weakening in the labour market.
Importantly there was a notable absence of caveats such as ‘gradual/gradualism’ as used by other Fed officials, said Tapas Strickland, head of market economics at NAB.
The jobs report on September 6 is clearly important as Powell is willing to cut rates to ward off downside risks to employment and to maintain a strong labour market, he said. In summary, Powell has increased the possibility of a soft landing.
