US nonfarm payrolls are expected to show more than 200,000 new jobs added to the economy in March
US stocks slipped on Thursday as investors were cautious ahead of the March jobs report. Also, market participants continued to fear the Federal Reserve could hold off on interest rate cuts. Investor sentiment was dented by hawkish comments from a Fed official. Minneapolis Fed President Kashkari said that he wondered if the central bank should cut rates at all if inflation remained sticky. Against this backdrop, the Dow Jones lost 1.35% to suffer its worst session in more than a year. The index saw its fourth consecutive losing day. The S&P 500 dropped 1.23% and the tech-heavy Nasdaq Composite dipped 1.40%.
Following suit, Asian equities were mostly lower on Friday. Japan’s benchmark Nikkei 225 sank 2.4%, Sydney’s S&P/ASX 200 slipped 0.8%, South Korea’s Kospi dropped nearly 1.0% and Hong Kong’s Hang Seng lost 0.8%. Apart from Fed-related doubts, investors in the regional markets were nervous about tensions in the Middle East. Fears of an escalation in the Middle East sent oil prices soaring. Meanwhile, the yen extended a rally to hit a two-week high as Bank of Japan Governor Ueda triggered rising bets about an additional interest rate hike later in the year.
Tracking declines in the US and Asia, European stocks fell the most in almost two months ahead of the weekend. The Stoxx 600 lost more than 1% in early deals. However, US stock index futures pointed to a slight rebound on Wall Street ahead of a key jobs report. US nonfarm payrolls are expected to show more than 200,000 new jobs added to the economy in March.
Meanwhile, the US dollar holds steady on Friday after the recent decline from mid-November highs. Following peaking at 105.10, the USD index retreated to briefly derail the 104.00 figure before steadying around 104.25 in anticipation of US jobs data. Strong figures could bring the bulls back into the game to push the greenback to the 104.50 region, followed by the 104.70 zone that represents the immediate barrier on the way to the 105.00 key handle. On the downside, the nearest support arrives at 104.00.
