Home ›› 05 Apr 2022 ›› Asia Biz
Asian markets were mixed Monday as another strong jobs report provided some reassurance that the recovery in the US economy remained on track but also solidified expectations for more aggressive Federal Reserve interest rate hikes.
The gains were helped by another drop in oil prices after the 31-nation International Energy Agency agreed to tap its vast reserves to offset the removal of Russian exports, while the start of a ceasefire in Yemen eased concerns over supplies from the region.
Officials said Friday that the world’s top economy added 431,000 positions in March while the unemployment rate fell to just slightly above pre-pandemic levels.
The figures showed that while inflation has surged to a 40-year high and the Ukraine war has fanned uncertainty, the recovery continues.
The economy’s resilience will be taken as further evidence that the economy could withstand a sharper rise in interest rates to bring prices under control, with many observers now predicting a half-point hike in May.
However, expectations that rates will continue to go up have seen Treasury yields surge with commentators saying there were warning signs that growth will slow as the year progresses.
“It would not be surprising to see yields rise further from here and it is very hard to know where they will land,” Angela Ashton, of Evergreen Consultants, noted.
“Markets are volatile and there is every chance they will overshoot.”
A positive close on Wall Street was followed by a broadly upbeat start to the week in Asia.
Hong Kong led gains thanks to a rally in tech firms after Beijing removed a rule preventing US authorities from inspecting the audits of Chinese companies listed in New York.
The announcement came after a drawn-out row between the two countries with Washington saying Chinese firms could be delisted by 2024 if they do not comply with audit requirements.
The demand put at risk more than 200 companies including ecommerce titans Alibaba and JD.com and Tencent.
