Japanese, Australian and South Korean stocks edged higher, with benchmarks for Hong Kong and mainland China also opening on a positive note. Futures for US equities advanced early in Asia after both the S&P 500 Index and the tech-heavy Nasdaq 100 Index rose over 1% on Thursday.
In Japan, Aozora Bank Ltd. fell as much as 19%, compounding the heavy selling seen on Thursday due to the firm’s exposure to US commercial property. The lender’s share price is down almost a third this week.
Treasuries were steady after an advance on Thursday that dragged the 10-year yield three basis points lower. Australian yields fell early Friday while New Zealand bonds were steady.
The moves come ahead of US nonfarm payrolls data due later on Friday which are expected to show a slowdown in new jobs added to the economy. Separate data released on Thursday pointed to an increase in jobless claims, which suggested a softening in the labour market.
“Traders are not letting go of the possibility of an earlier-than-expected rate cut,” said Fawad Razaqzada at City Index and Forex.com. “Those expectations could rise further if incoming US data from now on takes a bearish turn.”
The rally in Treasuries and fresh demand for gold, that pushed the price of the precious metal higher for a fourth session on Thursday, signalled further angst over US regional banks.
An index of US regional financials is on pace for its worst week since May last year, during the fallout of the banking crisis. The declines came as Citizens Financial Group Inc.’s chief executive said the issues that led to the collapse of several lenders last year are largely in the past.
Japanese banking giant Mizuho Financial Group is likely to show a decline in third-quarter net income when it reports earnings later today.
An index of the dollar stabilised after a Thursday drop that reflected lower US yields, while the yen was little changed on Friday. The British pound was flat after a Thursday rally when the Bank of England warned that price pressures could re-emerge.
Meta Platforms Inc rose as much as 15% in post-market trading on strong earnings. The company announced its first-ever quarterly dividend of 50 cents a share and authorised an additional $50 billion in buybacks. Amazon.com Inc. shares advanced around 9% after the bell following results that showed strong sales. The momentum outweighed a decline in Apple Inc, which unveiled a deepening slump in China despite overall sales growing.
“Some of the earnings have been great,” Max Wasserman, founder and senior portfolio manager for Miramar Capital, said on Bloomberg TV. “You’re hearing good numbers from Meta, decent numbers from Amazon — the one caveat is you’re not hearing great numbers from Apple.”
The gains for US stocks on Thursday marked a rebound from the prior session, when shares fell after the Federal Reserve pushed back against the prospect of a March rate cut.
Goldman Sachs Group Inc., Bank of America Corp. and Barclays Plc — among the last Wall Street holdouts expecting the Fed to start lowering their benchmark rate as soon as March — have pushed back their forecasts for cuts after the conclusion of the central bank’s policy meeting Wednesday.
Swap contracts that predict the outcome of future Fed meetings are priced for about 150 basis points of easing this year, with the first move fully priced in for May.
Oil prices retraced a decline on Thursday. Bloomberg News reported negotiations are advancing for a deal to pause the Israel-Hamas war and free civilian hostages.
