Asia stocks climb on Fed relief yet markets stay cautious

Asian stocks climbed in early Thursday dealings after softer signals from the U.S. Federal Reserve eased nerves during a week of heavy bond selling and global growth worries.

Australia’s benchmark rose 0.8%, rebounding from its biggest one-day drop since April, while Japan’s Nikkei 225 advanced 1.2%.

The regional picture was mixed. MSCI’s measure of Asia-Pacific equities excluding Japan slipped 0.2% after an early rise, weighed down by China.

The Shanghai Composite fell 1.6% and was on track for a third straight decline after a Bloomberg report said financial regulators are preparing measures to cool the market. Most Asia-Pacific indexes took their cue from Wall Street’s tech rebound, after gains in the S&P 500 and Nasdaq.

European futures point to modest gains

In Europe, a slightly stronger open was signaled as investors assessed U.S. trade policy. Futures pointed to the U.K.’s FTSE up 0.16%, France’s CAC 40 up 0.1%, Italy’s FTSE MIB up 0.15%, and Germany’s DAX near unchanged, according to IG. No major earnings are due in Europe, while EU retail sales data are scheduled later.

September has opened on a soft footing for risk assets as longer-maturity bonds fell, denting confidence ahead of Friday’s U.S. non-farm payrolls report.

Later today, Japan will auction 30-year government bonds. It is a key test of demand for very long-term debt.

Last night’s bond sell-off eased, but concern about government finances in Japan, Britain, and the United States is keeping long-term interest rates near multi-year highs. Sentiment improved as several Fed officials, including Governor Christopher Waller, signaled they favor cutting rates in the coming months as reported by Cryptopolitan.

In Washington, Stephen Miran, President Donald Trump’s nominee for a vacant Fed Board seat, said he would work to protect the central bank’s independence.

Labor signals remain in focus

Weaker-than-expected job openings in Wednesday’s JOLTS report added to bets on a cut at this month’s meeting. The Fed’s Beige Book showed a mixed backdrop for the U.S. economy as per Reuters.

Traders now see a 96.6% chance of a September rate cut, according to CME Group’s FedWatch tool.

On Thursday, Wall Street will review the ADP private payrolls report; economists expect 75,000 jobs in August, down from 104,000. Weekly jobless claims are also expected to edge higher. These updates arrive before Friday’s main payrolls report.

Trade policy is also in the spotlight after a federal appeals court last week found most of President Trump’s tariffs illegal.

On Wednesday night, the president asked the Supreme Court to take the case on an expedited basis, seeking arguments in early November and a quick ruling soon afterward, according to filings cited by NBC News.

In fixed income, the 10-year U.S. Treasury yield edged up to 4.2226% from 4.211% late Wednesday, while the two-year reached 3.6187% from 3.612%. In currencies, the dollar held at ¥148.13; the euro eased to $1.1652; and the dollar index inched up to 98.217.

Brent crude slipped 0.5% to $67.29 per barrel. Spot gold fell 0.8% to $3,529.94 an ounce after setting a record on Wednesday.

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