Asian markets sink again, US jobs data in focus

[HONG KONG] Asian markets fell Friday morning, at the end to a volatile week dominated by the fallout from Britain's European Union exit, with investors now turning their attention to the release of US jobs data.

The release of the June non-farm payrolls figures from Washington will be pored over for an idea about the Federal Reserve's interest rate plans in light of the Brexit vote and following a surprisingly low reading in May.

They also follow a week of losses across markets after the head of the Bank of England said the risks of leaving the EU were "crystalising" and British property investment funds suspended client withdrawals to prevent a run on them.

"While a strong June report is not going to ring alarm bells for an imminent rate hike, strong print tells the market that when the post-Brexit dust settles, the door will be open for the Fed to resume a path of interest rate normalisation," Stephen Innes, senior trader at Oanda Asia Pacific, said in a note.

Tokyo ended the morning 0.4 per cent lower, Hong Kong slipped 0.5 per cent, Shanghai eased 0.8 per cent, while Seoul and Singapore each lost 0.6 per cent. Sydney was flat.

European markets provided a positive lead after minutes from the European Central Bank's pre-Brexit policy meeting highlighted worries about the health of eurozone banks and hinted at more potential stimulus if Britain voted to the EU.

Weak German data added to expectations of further monetary support. London's FTSE 100 also produced a healthy rally thanks to bargain-buying after recent losses.

On currency markets the lingering fear of riskier assets is keeping the US dollar subdued against the safe-haven yen, while the greenback climbs against emerging market and higher-yielding units.

The US dollar was at 100.81 yen, unable to break above the 101 yen level and keeping traders guessing as to whether Japan's central bank will step in to protect the country's exporters.

Australia's dollar eased 0.2 per cent against the US unit, while the South Korean won was down 0.5 per cent and Indonesia's rupiah shed 0.4 per cent. The oil-linked Malaysian ringgit lost 0.7 per cent.

Oil prices bounced back slightly Friday after a mauling the day before being fuelled by a less-than-expected fall in US inventories.

US benchmark West Texas Intermediate added 0.8 per cent to US$45.50 and Brent rose one per cent to US$46.86.

WTI fell 4.8 per cent Thursday and Brent shed 4.9 per cent.

AFP