Market Volatility in Asia-Pacific as Japan Slower Wage Growth

Asia-Pacific markets show mixed results; Japan reports wage growth data impacts the Nikkei, while Chinese developers see optimism.

Asia-Pacific Stock Markets:

• Nikkei 225: Down 1.03%
• Shanghai Composite: Down 0.17%
• Hang Seng Index: Down 0.48%
• S&P/ASX 200: Up 0.31%

Commodities:

• Gold: $2,527.35 (+0.09%)
• Silver: $28.50 (+0.31%)
• Brent Crude Oil: $72.90 (+0.49%)
• WTI Crude Oil: $69.20 (+0.48%)

Interest Rates:

• US 10-year Treasury Yield: 3.764%
• UK 10-year Gilt Yield: 3.936%
• Germany 10-year Bund Yield: 2.2173%

News & Data:

• CAD Overnight Rate: 4.25%, in line with expectations

Market Volatility in Asia-Pacific as Japan Reports Slower Wage Growth

Market Overview: Asia-Pacific markets experienced a mixed session on Thursday, with notable volatility following a previous sell-off. Japan’s Nikkei 225 declined, falling 1.03%, influenced by Japan’s July wage data release. The data revealed a 3.6% year-on-year increase in average monthly earnings, a deceleration from June’s 4.5% rise. Real wages showed a modest growth of 0.4%, suggesting that while wages are rising, the pace has slowed. This slower wage growth might impact the Bank of Japan’s monetary policy, potentially leading to increased interest rates that could pressure equity markets.

The Kospi index declined slightly in South Korea, and the Kosdaq saw a 1% drop. However, shares of SK Hynix surged by 3.36% following the announcement of plans to begin mass production of HBM3E chips by the end of September.

Australia’s S&P/ASX 200 bucked the trend with a 0.3% gain, bolstered by a 0.7% increase in July exports and a reduction in imports.

The Hang Seng Index fell by 0.48% in Hong Kong, while China’s CSI 300 index showed a minor increase. Positive sentiment among Chinese developers was noted, with potential interest rate cuts on the horizon to aid the struggling property sector. China Vanke shares increased by 1.5%, and Logan Group saw a gain of 1.32%.

In the United States, the S&P 500 and Nasdaq Composite experienced their second consecutive day of losses, down 0.16% and 0.3%, respectively. Conversely, the Dow Jones Industrial Average managed a small gain of 0.09%.

Upcoming Economic Events:

• 12:15 PM GMT – USD ADP Non-Farm Employment Change
• 12:30 PM GMT – CAD Labor Productivity (q/q)
• 12:30 PM GMT – USD Unemployment Claims
• 1:45 PM GMT – USD Final Services PMI
• 2:00 PM GMT – USD ISM Services PMI

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