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Stocks in Asia were set to decline at the open on Friday amid renewed concerns over the potential for a long-term trade deal between China and the U.S.
Futures pointed to a lower open for Japanese shares. The Nikkei futures contracts in Chicago and Osaka were both at 22,720. That compared against the Nikkei 225’s last close at 22,927.04.
Shares of gaming firm Nintendo will be watched today, after the company announced on Thursday a second-quarter profit that exceeded expectations.
Meanwhile, shares in Australia declined in early trade. The S&P/ASX 200 slipped 0.31% as the sectors were mixed.
In Hong Kong, ESR Cayman is set to make its public debut on Friday, which is expected to be the second largest IPO for the city this year. That would follow Budweiser APAC’s IPO — the second largest globally this year — in Hong Kong inSeptember.
A private survey of factory activity in China is expected later on Friday, with the Caixin/Markit Purchasing Managers’s Index (PMI) for the manufacturing sector set to be out around 9:45 a.m. HK/SIN. That comes a day after official data showed manufacturing activity in China shrank for the sixth straight month in October.
US-China trade fears
Investors will watch for developments in U.S.-China trade amid renewed jitters after Bloomberg News reported Thursday, citing sources, that Chinese officials have been casting doubt over the possibility of a long-term trade deal with the U.S. The report added Chinese officials are concerned about U.S. President Donald Trump’s “impulsive nature” and the risk of him backing out of any kind of deal.
That development came amid recent optimism for a “phase one” deal to be signed between the two economic powerhouses soon. The deal had been initially been expected to be signed at a November summit in Chile, an event which has since been canceled by the country due to ongoing anti-government protests.
For his part, U.S. President Donald Trump said Thursday a new location for signing the “phase one” trade deal with China “will be announced soon.”
Beijing and Washington have been engaged in a trade war since 2018, with tariffs having been slapped on billions of dollars worth of each other’s goods.
Overnight on Wall Street, trade jitters sent shares on Wall Street lower. The Dow Jones Industrial Average closed 140.46 points lower at 27,046.23 while the S&P 500 slid 0.3% to end its trading day at 3,037.56. The Nasdaq Composite fell 0.1% to close at 8,292.36.
The October jobs report for the U.S. is expected later Friday stateside, expected to be unusually weak due to the strike at General Motors. Economists expect that just 75,000 jobs were created in October, and the unemployment rate is expected to tick up slightly to 3.6% from 3.5%, according to Dow Jones.
Currencies
The U.S. dollar index, which tracks the greenback against a basket of its peers, was last at 97.352 after slipping from levels above 97.4 yesterday.
The Japanese yen, often seen as a safe-haven currency in times of market uncertainty, traded at 108.01 against the dollar after strengthening from levels above 108.5 in the previous session. The Australian dollar changed hands at $0.6891 after falling from levels above $0.692 seen yesterday.
What’s on tap:
- China: Caixin/Markit Manufacturing PMI at 9:45 a.m. HK/SIN
- Japan: Manufacturing PMI for October at 8:30 a.m. HK/SIN
- India: Nikkei/Markit Manufacturing PMI for October at 1:00 p.m. HK/SIN
— CNBC’s Fred Imbert and Patti Domm contributed to this report.