EQUITIES
Asia-Pacific stocks were mixed on Friday trade. The Shanghai composite in mainland China fell 0.65%, while Hong Kong’s Hang Seng index declined 0.99%, and the Singapore’s Straits Times index slipping 0.20%.
Elsewhere, the S&P BSE Sensex in India added 0.21%, while the South Korea’s KOSPI and Australia’s S&P/ASX 200 traded little changed, hovered above the flatline.
Markets in Japan are closed on Friday for holiday, and off 1.7% for the week and a whisker away from a 7-month trough.
Overnight on Wall Street, the Dow Jones Industrial Average rose 0.07%, to 34,823.35, the S&P 500 gained 0.20%, to 4,367.48 and the Nasdaq Composite added 0.36%, to 14,684.60.
OIL
Oil prices trimmed overnight gains on Friday but heads to end the week steady, underpinned by expectations of tighter supplies until the end of the year as economies recover from the pandemic, even after OPEC+ agreed to expand production.
The Brent traded at $73.56 per barrel, and U.S. crude futures traded at $71.68 per barrel.
Overnight, the Brent closed at $73.79, while WTI ended at $71.91 per barrel.
CURRENCIES
The yield on 10-year Treasury were steady on Friday at 1.282%, after slipped on Thursday following the auction of $16 billion in 10-year TIPS touched a record low, pressuring rate sensitive banks.
The dollar index rose to 92.882, held close to a 3-1/2-months recorded on Wednesday. The dollar index is on track to advance 0.1% for the week.
GOLD
Gold prices steadied on Friday after hitting a more than 1-week low in the previous session. Bullion is expected to decline this week, after posting gains for the previous four weeks.
Spot gold was flat at $1,803.70 per ounce, after hitting its lowest since July 12 at $1,791.16 on Thursday. U.S. gold futures slipped to $1,804.20 per ounce.
Silver added 0.19% to $25.43 per ounce, palladium rose 0.75% to $2,725.00, and platinum was flat at $1,092.10.
ECONOMIC OUTLOOK
Asian share markets were in a mixed mood on Friday after a volatile week in which sentiment over global growth waxed and waned with every new headline on the Delta variant.
Big tech helped Wall Street to close higher overnight, as investors digested negative economic data reflecting the country's struggle to move past the COVID-19 pandemic.
Alternatively, investors are now monitoring Chinese tech stocks after regulatory concerns resurfaced. In Hong Kong, shares of Chinese tech firms listed in the city fell. Kuaishou plunged 9.1% Tencent slipped 0.74% and Meituan dropped 1.43%. Shares of Didi stateside plunged more than 11% on Thursday.
The number of U.S. workers filing first-time applications for unemployment benefits spiked unexpectedly to 419,000 last week, a two-month high, a reminder that the labour market was far from being out of the woods as the nation confronts a resurgence in new COVID-19 infections.
The ECB pledged to keep interest rates at record lows for even longer to boost sluggish inflation and warned that the rapidly spreading Delta variant of the COVID-19 poses a risk to the eurozone's recovery. It would not hike borrowing costs until it sees inflation reach its 2% target "well ahead of the end of its projection horizon and durably" -- a controversial decision that generated significant dissent.
Crude inventories in the U.S., rose unexpectedly by 2.1 million barrels last week to 439.7 million barrels, up for the first time since May, U.S. EIA data showed. Gasoline and diesel demand also jumped.
A slew of surveys on July manufacturing PMI are expected today, with a slight softening of activity in Europe and the U.S., though from very high levels, while Asia looks more vulnerable.
TECHNICAL OUTLOOK
[USDJPY]
Important Levels to Watch for Today:
- Resistance line of 110.391 and 110.536.
- Support line of 109.922 and 109.754.
Commentary/ Reason:
The U.S. dollar traded at 110.256 per yen, stronger than level below 109.06 seen against the Japanese yen earlier this week.
The pair gains modestly during the week, less than 0.1%, with Japanese markets will remain closed amid an extended local holiday and softening mood during US trading hours.
The rebound in U.S. T-note yields meanwhile sparked some strength in the dollar.
With holiday in Japan and only U.S. manufacturing releases to take care of, the USD/JPY pair expected to hover rangebound, to little changed daily. However, the pair also seeing to be moving back towards the trendline, where we may expect to see buyers return to take price action back.
