SINGAPORE (Reuters) – Asian share markets tried to regain their footing on Thursday after a steep sell-off, while a rally in Treasuries dented the dollar and lifted the yen as U.S. economic worries raised the odds of the Federal Reserve going big on rate cuts.
Oil prices were steady in early trading after dropping in the previous sessions on weak demand and supply woes, while gold edged higher. [GOL/] [O/R]
In a data-packed week, investors are poring over the reports dropping in to gauge the health of the U.S economy and the labour market, with a weak manufacturing data on Tuesday and Wednesday’s mixed labour data keeping markets on edge.
Japan’s Nikkei fell 0.5% to its lowest in three weeks, although tech-heavy Taiwan and South Korean stocks were both 1% higher after sliding on Wednesday.
That helped lift MSCI’s broadest index of Asia-Pacific shares outside Japan by 0.6%, having tumbled nearly 3% over the course of a three-day losing streak.
Investor attention on Thursday will be on a reading on the U.S. services industry with jobless claims data. The main focus for the week though will be on Friday’s hotly anticipated August report for nonfarm payrolls.
The payrolls report is expected to provide the clearest clues as to where the economy is headed and whether the Fed will cut interest rates this month by a quarter or a half of a percentage point.
Markets are now pricing in a 44% chance of the Fed cutting rates by 50 basis points at its Sept. 17-18 meeting, up from 38% a day earlier, CME FedWatch tool showed. Traders are now anticipating 110 bps of easing this year from the three remaining Fed meetings.
