- Asian stocks are lacking a clear directional bias ahead of the US monthly jobs data.
- Marketa are currently pricing in a more than 80% chance of a Fed rate cut on Oct. 30.
Asian equities are trading mixed, possibly due to caution ahead of the US monthly jobs data that could influence the Federal Reserve’s (Fed) next policy move.
At press time, Japan’s Nikkei is reporting marginal losses, while the stocks in Australia and South Korea are reporting modest gains. Meanwhile, Hong Kong’s Hang Seng index is down 0.28% and the futures on the S&P 500 are shedding 0.12%.
The US stocks eked out gains Thursday after the disappointing US ISM Non-manufacturing data bolstered investor expectations for a Fed rate cut at Oct. 30’s meeting. Notably, the Dow Jones Industrial Average rose by 122 points or 0.47%.
As of now, traders are pricing more than 80% chance of a third, 25-basis point rate cut at the Fed’s Oct. 30 meeting, according to the CME’s FedWatch tool. The probability stood at 40% on Monday.
The rate cut odds will likely rise to 100% if the US September Nonfarm Payrolls, due at 12:30 GMt, miss estimates by a big margin.
Markets, however, may see a significant pricing out of rate cut expectations if the US jobs and wage growth data blows past expectations.
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