Stocks rise ahead of US jobs data

HONG KONG, Aug 5 (Reuters) – Asian stocks rose on Friday ahead of U.S. jobs data that will give another clue to the health of the world’s biggest economy as warning signs erupted in the bond markets and that oil traded around its lowest level since the start of the war in Ukraine.

MSCI’s broadest non-Japan Asia-Pacific equity index (.MIAPJ0000PUS) rose 0.74%, boosted by index heavyweight TSMC (2330.TW), which jumped 3.2 %, regaining the ground it had lost earlier in the week due to tensions surrounding the United States House. Representatives Visit of President Nancy Pelosi to Taiwan.

The regional index should therefore end a third consecutive week in positive territory, while the Japanese Nikkei (.N225) gained 0.83%.

EUROSTOXX 50 and S&P 500 futures both gained 0.2%.

But the main event of the day, US jobs data, is yet to come as investors wait to see if the aggressive pace of rate hikes from the US Federal Reserve begins to slow economic growth.

Non-farm payrolls are expected to rise by 250,000 jobs last month, after increasing by 372,000 jobs in June.

Last week, US stocks and Treasuries rose as markets decided the Fed might raise rates less aggressively on fears of a recession and hopes of slowing inflation, although many Fed policymakers pushed back on those suggestions this week.

“We are waiting to see a slowdown in the labor market, so if we get a big miss, it will finally confirm that the labor market is slowing down, and we will see further rallies in US Treasuries,” said Prashant Bhayani, Chief Investment Officer for Asia at BNP Paribas Wealth Management.

Other asset classes are already showing a slowdown.

“The bond market is saying there’s a pretty high risk of a recession, while the stock market is focusing on labor data,” Bhayani said.

The closely watched part of the US Treasury yield curve measuring the spread between two- and 10-year Treasury yields hit 39.2 basis points overnight, the deepest inversion since 2000 .

An inverted curve is often considered a harbinger of a recession.

On Friday morning, the 10-year yield was 2.6936% and the two-year yield was 3.0531%, leaving the spread between them at 36 basis points.

In another sign that growth may be slowing, oil closed overnight at its lowest levels since February, before the war in Ukraine.

“Crude oil fell sharply as recession fears raised worries about weaker demand,” ANZ analysts said, with the declines also due in part to Wednesday’s data showing a rise in U.S. inventories. last week. Read more

Prices picked up a bit in Asian trading on Friday, with benchmark Brent crude futures up 0.5% at $94.61 a barrel and US crude futures up 0. .7% to $89.12 a barrel.

In currency markets, the dollar index, which measures the greenback against six major peers, was at 105.93, up a fraction after falling 0.6% overnight alongside falling US yields.

The pound was down a hair against the dollar at $1.2142 after taking an overnight turn as the Bank of England raised interest rates and warned that a long recession was approaching. Great Britain. Read more

Spot gold was flat at $1,790 an ounce.

(This story corrects title to remove superfluous words)

Editing by Stephen Coates

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