Australia

Australian shares are set to open higher as US bond yields calmed and investors anticipate September employment data.

ASX futures were up 0.02% or 2 points as of 8:00am on Friday, suggesting a higher open.

US stocks edged lower Thursday and Treasury yields stabilized as investors looked ahead to Friday's jobs report.

Major indexes spent most of the day lower before turning positive in the afternoon and then dipping again. Some investors said the market seemed to be in a holding pattern ahead of the morning release of the September employment report. That could hold clues to the Federal Reserve's progress in its fight against inflation and what could happen at its November meeting and beyond.

"The market is trying to sort out what the Fed is going to do," said Jim Polk, head of equity investments at Homestead Advisers. "I think that's going to drive the market for a while."

The S&P 500 fell 0.1%, while the Dow Jones Industrial Average edged down less than 0.1%, or about 10 points. The tech-heavy Nasdaq Composite dropped 0.1%.

In commodity markets, Brent crude oil fell 1.8% to US$84.23 a barrel while gold was flat at US$1,820.10.

In local bond markets, the yield on Australian 2 Year government bonds was down at 4.05% while the 10 Year yield was also down at 4.57%. US Treasury notes were higher, with the 2 Year yield at 5.02% and the 10 Year yield at 4.72%.

The Australian dollar was higher at 63.69 US cents from its previous close of 63.24 US cents. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies, was flat at 100.23.

Asia

Markets in mainland China are closed this week for a holiday.

Hong Kong shares closed slightly higher amid gains in consumer and property stocks. The mood was broadly cautious, with many investors in wait-and-see mode ahead of more Chinese economic data due next week and with mainland markets closed for a holiday, IG strategist Jun Rong Yeap said in an email. The Hang Seng Index rose 0.1% to 17213.87. The Chinese holiday season buoyed consumer stocks, with Budweiser Brewing adding 5.4% and China Resources Beer up 2.4%. Property developers also rose, with Sunac China jumping 6.3% after a Bloomberg report said it got court approval for debt restructuring. Longfor rose 1.9% and New World Development added 2.2%. Tech led the losses, with Alibaba Health and Xiaomi down 2.1% and 1.5% respectively.

Japanese shares ended higher, led by gains in real-estate, auto and bank stocks, as the U.S. bond-market rout eased, alleviating concerns about higher borrowing costs. Mitsubishi Estate gained 4.8%, Toyota Motor advanced 4.5% and Mitsubishi UFJ Financial Group added 4.0%. The Nikkei Stock Average rose 1.8% to 31075.36. The 10-year Japanese government bond yield fell half a basis point to 0.800%. Investors are focusing on economic data and U.S. Treasury yields.

India's benchmark Sensex rose 0.6% to close at 65631.57 amid falling Treasury yields. The retreat in yields helped Wall Street's rebound, which in turn translated into a recovery in Asia's equity markets, says Michael Hewson, chief market analyst at CMC Markets, in an email. Among the best performers on the benchmark index, Larsen & Toubro rose 2.35%, Titan Co. added 1.5% and Tata Consultancy Services was up 1.5%. Meanwhile, Power Grid Corp. fell 1.3% and NTPC was down 0.5%.

Europe

European stocks closed mixed, with the pan-European Stoxx Europe 600 closing up 0.3% at 441.31 though Germany's DAX index ended the day lower as trade stayed cautious ahead of key U.S. jobs data on Friday. A calmer bond market, with yields turning lower, helped sentiment, though traders remained wary that a strong U.S. non-farm payrolls report could intensify concerns about interest rates staying higher for longer. "It seems most leading indicators suggest [U.S.] job growth will remain healthy, which should keep the bond market selloff going strong," writes Oanda analyst Edward Moya. The U.K.'s FTSE 100 index outperformed, closing up 0.5%, while France's CAC 40 ended flat and the DAX lost 0.2%.

FTSE 100 closed up 0.5%, a modest rebound in the wake of a strong session in Asia markets. "The FTSE 100 is managing to outperform despite the sharp fall in oil prices, which is dragging on BP and Shell but helping consumer discretionary with airlines enjoying a solid session, led by the likes of easyJet, Wizz Air and British Airways owner IAG," CMC Market UK Chief Market Analyst Michael Hewson says in a market comment. Tobacco company Imperial Brands was the top gainer, with a 3.9% rise, after backing its full-year guidance and launching a 1.1 billion pound ($1.33 billion) buyback. The index closed up 7,451.54 points.

North America

U.S. stocks edged lower Thursday and Treasury yields stabilized as investors looked ahead to Friday's jobs report.

Major indexes spent most of the day lower before turning positive in the afternoon and then dipping again. Some investors said the market seemed to be in a holding pattern ahead of the morning release of the September employment report. That could hold clues to the Federal Reserve's progress in its fight against inflation and what could happen at its November meeting and beyond.

"The market is trying to sort out what the Fed is going to do," said Jim Polk, head of equity investments at Homestead Advisers. "I think that's going to drive the market for a while."

The S&P 500 fell 0.1%, while the Dow Jones Industrial Average edged down less than 0.1%, or about 10 points. The tech-heavy Nasdaq Composite dropped 0.1%.

One source of easing pressure on stocks: The yield on the benchmark 10-year U.S. Treasury note declined for a second consecutive day. The 10-year's yield ended Thursday at 4.715%, down from 4.735% on Wednesday. On Tuesday, it rose to 4.801%, its highest 3 p.m. yield since August 2007.

Stocks were lower in morning trading after data showed weekly initial jobless claims edged up to 207,000, below the 210,000 economists had forecast.

"If the labor market is tighter than expected, then wage growth will remain high," said Irene Tunkel, chief U.S. equity strategist at BCA Research. "It exacerbates fears of the second wave of inflation or -- at least -- a more hawkish Fed."

Soaring yields have helped blunt the stock market's 2023 rally by giving investors lower-risk ways to generate returns. At the end of July, the S&P 500 was up nearly 20% for the year. That advance has dwindled to 11%.

Performance within the S&P 500 on Thursday was a grab bag. Technology, healthcare and financials were among the sectors to end the day higher, while the consumer staples, industrials and energy segments fell.

The pullback by energy stocks came as oil prices fell for a second consecutive day, with Brent crude, the global benchmark, declining 2% to $84.07 per barrel. Brent gained 9.7% in September but after a big drop Wednesday is trading at prices it last settled at in August.

Among individual stocks, shares of Lamb Weston rallied 8%, making it the best performer in the S&P 500, after the potato-products company reported that raising prices had helped its results. Rivian Automotive shares tumbled 23% after the electric-vehicle maker announced a $1.5 billion debt offering.

Clorox shares fell 5.2%. The cleaning-products company warned late Wednesday that it would post an unexpected loss for the quarter that ended Sept. 30 after a cyberattack brought business to a near halt in August.

General Motors shares declined 2.4% after news that the automaker has at least 20 million vehicles built with a potentially dangerous airbag part that the government says should be recalled.