Asian Stocks Rebound as Won, Ringgit Gain; Oil Retreats

FXTM Online Analysis Department. www.fxtmonline.com

     Asian stocks halted their longest slump since February and the dollar weakened against emerging-market currencies as investors await U.S. jobs data. Oil pared its weekly gain.

The MSCI Asia Pacific index rose for the first time in six days, adding 1 percent by 10:59 a.m. in Tokyo as Japanese shares rebounded and Chinese stocks in Hong Kong increased for a fourth day. The Korean won and Malaysian ringgit climbed versus the dollar. U.S. oil dropped 1.1 percent after surging the most in two months. Markets in Japan, South Korea and mainland China will open Friday while most other Asian, U.S. and European venues will be shut for holidays.

With the Federal Reserve saying its first interest-rate increase since 2006 will depend on strong economic data, traders are focused on Friday’s monthly payrolls report, which is projected to deliver an increase of 245,000 workers. Weaker-than-estimated reports onhiring and manufacturing Wednesday fueled speculation that the U.S. economy is slowing.

“You’ve got payrolls tomorrow and you’ve still got the backdrop of Fed rate hikes that I think will come later, rather than sooner,” Mark Lister, head of private wealth research at Craigs Investment Partners Ltd., which manages about $7.2 billion, said by phone from Wellington. “We’re still overweight equities, but a little bit less so. It will be tougher and more volatile from here and you have to be nimble.”

The Asia-Pacific index dropped more than 2 percent over the past five days after valuations on the 997-stock gauge reached the highest level in five years. While the Fed mulls rate increases, central banks from Europe to Asia have supported the outlook for equities, ramping up stimulus and easing policy in a bid to stoke growth and beat deflation.

Asian Indexes

The Topix rose for the first time in three days, led by finance and insurance stocks. Australia’s S&P/ASX 200 Index gained 0.7 percent, while the NZX 50 Index slipped 0.2 percent in Wellington. The Kospi index in Seoul climbed 0.5 percent on volume more than 70 percent higher than the 30-day average for the time of day.

The Hang Seng China Enterprises Index added 0.8 percent to take its four-day increase beyond 6 percent. The Shanghai Composite Index climbed 0.3 percent and is trading at a seven-year high. Shanghai traders now have more than 1 trillion yuan ($161 billion) of borrowed cash riding on the world’s highest-flying stock market.

Markets in Australia, New Zealand and most of Europe are closed Friday for holidays. India, the Philippines, Hong Kong, Singapore, Taiwan and Indonesia are also shut.

S&P 500

The Standard & Poor’s 500 Index slipped 0.4 percent for a second straight loss Wednesday. U.S. manufacturing expanded in March at the slowest pace since May 2013, while data from the ADP Research Institute showed companies added fewer workers last month than economists forecast.

Yields on 10-year Treasuries were little changed at 1.87 percent after sliding seven basis points Wednesday.

The won added 0.4 percent to 1,097.92 per dollar in a second day of gains, while the ringgit climbed 0.5 percent to 3.68 a dollar. The Thai baht gained 0.2 percent and the yen was steady at 119.61 a dollar after strengthening 0.3 percent last session.

The Bloomberg Dollar Spot Index, a gauge of the U.S. currency versus 10 major peers, was little changed after slipping 0.2 percent Wednesday, its first retreat in five days.

West Texas Intermediate crude retreated to $49.52 a barrel. The U.S. Energy Information Administration said Wednesday that oil output fell by 36,000 barrels a day last week, while talks between world powers and Iran over the country’s nuclear program continued.

Gold for immediate delivery resumed declines, falling 0.1 percent to $1,202.60 an ounce, its fourth drop in five days. Platinum decreased 0.3 percent to $1,161 an ounce.

Iron ore, Australia’s biggest export, slid for a sixth day Wednesday at China’s Qingdao port, sinking 3.5 percent to $49.53 a dry metric ton, the lowest level in data from Metal Bulletin Ltd. going back to 2009.

FXTM Online Analysis Department. www.fxtmonline.com