Asia: Stocks follow Wall Street higher after US jobs data beats forecasts

[SINGAPORE] Asian stocks rallied on Monday, lifted by Wall Street's strong performance late last week, while the US dollar extended gains made after much stronger than expected June employment data.

MSCI's broadest index of Asia-Pacific shares outside Japan advanced 0.15 per cent while Japan's Nikkei rose 0.5 per cent.

Australian stocks were up 0.4 per cent and South Korea's Kospi added 0.2 per cent.

On Friday, Wall Street closed higher after US jobs growth beat forecasts. However, a lag in wage increases led investors to bet wage data would limit the extent of the Federal Reserve's hawkishness.

The Nasdaq led gains with a one per cent jump, while the S&P 500 added 0.6 per cent and the Dow Jones Industrial Average rose 0.4 per cent.

"Strong headline growth, amid poor wage growth, is seemingly a perfect storm for equities," Chris Weston, chief market strategist at IG in Melbourne, wrote in a note.

"Looking ahead, traders will continue to watch fixed income like a hawk for further knock-on effects into foreign exchange and equities," particularly with speeches by Fed chair Janet Yellen and governor Lael Brainard due this week, Weston added.

The 10-year US Treasury yield hit a two-month high of 2.398 per cent on Friday.

The US dollar inched up 0.1 per cent to 113.98 yen early on Monday, extending Friday's 0.6 per cent jump on the jobs data.

The US dollar index, which climbed 0.2 per cent on Friday, was little changed at 96.01 on Monday.

The euro was marginally lower at US$1.14015 on Monday, extending Friday's 0.1 per cent decline.

The Group of 20 meeting in Hamburg over the weekend didn't have much impact on markets on Monday.

At the meeting, the world's leading economies broke with the US on climate policy and US President Donald Trump and his Chinese counterpart Xi Jinping agreed to work together on North Korea's nuclear threat and bilateral trade.

Mr Trump also discussed forming a cyber security unit to guard against election hacking with Russian President Vladimir Putin.

In commodities markets, oil crept higher early on Monday after sliding on Friday on a report showing US crude production rose last week, just as Opec exports hit a 2017 high, rekindling concerns about a supply glut.

US oil rose 0.6 per cent to US$44.51 a barrel on Monday, making up some of Friday's 2.8 per cent loss.

Global benchmark Brent advanced 0.6 per cent to US$47.01, following Friday's 2.9 per cent slide.

Gold was steady at US$1,212.56, close to the four-month low touched on Friday as the US dollar surged.

REUTERS