ASIA-PACIFIC MID-SESSION UPDATE

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Asian equity markets trade mixed amid position squaring following the recent firm gains, with participants also tentative ahead of the today’s NFP

Asian equity markets trade mixed amid position squaring following the recent firm gains, with participants also tentative ahead of the today’s NFP and its possible implications for Fed policy. ASX 200 (-0.53%) is led lower by weakness in large banks and mining names after iron ore fell for the 3rd time in 4 sessions. The Nikkei 225 (+0.002%) traded flat amid mixed data release in which household spending rose to its highest in 3-months, while there was also an increase in unemployment. Elsewhere, Hang Seng (+2.06%) bucks the trend as it plays catch up to yesterday’s firm gains in Asia with Casinos outperforming in Hong Kong after a narrower than prior decline in Macau gaming revenues, coupled with reports that China is to support the Macau region.

In FX markets, price action was tepid with participants looking ahead to the Non-farm payrolls data later in the day. However, AUD/USD, had a knee jerk reaction to the release of Australian retail sales (0.40% vs. Exp. 0.40%) which was better than prior although it came in in line with expectations. Elsewhere, JPY continued to weaken as the nation’s unemployment rose and monetary base increased.

Finally, JGBs trade flat tracking the flat close in USTs in a quietly traded session, while the BoJ conducted market operations to purchase JPY 470bln in government debt.