Asian Markets Rally on Weak US Jobs Report
Asian markets rallied on Monday after a surprisingly weak US jobs report eased fears of an imminent Federal Reserve rate increase. The KOSPI surged 1.1%, while Japan's Nikkei 225 rose about 2%. MSCI's broadest Asia-Pacific gauge outside Japan gained 0.8%.
The US nonfarm employment fell by 23,000 in July, and May and June were revised down by a combined 103,000 jobs. The unemployment rate edged lower to 4.1%, largely because labor-force participation fell to 61.4%. This led to expectations for a September Fed increase being sharply lowered.
Treasury yields edged higher in Asia after Friday's rally, with the 10-year yield around 4.66%.
The Nikkei and KOSPI benefited from the rebound in US technology shares and lower bond yields, but their domestic risks remain different. For Japan, the yen is still a pressure point, while South Korea faces challenges related to its semiconductor trade.