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Asia-Pacific markets fall ahead of U.S. jobs report

Abigail Ng

This is CNBC's live blog covering Asia-Pacific markets.

The logo of the Tokyo Stock Exchange, operated by Japan Exchange Group Inc., is displayed at the bourse in Tokyo, Japan, on Oct. 2, 2020.
Akio Kon | Bloomberg via Getty Images

Shares in the Asia-Pacific fell on Friday ahead of the monthly U.S. jobs report, which is likely to guide the Federal Reserve's monetary decision in November.

Payrolls are expected to increase 275,000 in September, and unemployment is predicted to be steady at 3.7%, according to economists surveyed by Dow Jones.

Hong Kong's Hang Seng index lost 1.27% in the final hour of trade and the Hang Seng Tech index shed 2.96%. The Nikkei 225 in Japan fell 0.71% to 27,116.11 and the Topix index slipped 0.82% to 1,906.80. In Australia, the S&P/ASX 200 fell 0.8% to 6,762.80.

South Korea's Kospi lost 0.22% to 2,232.84 while the Kosdaq dropped 1.07% to 698.49. MSCI's broadest index of Asia-Pacific shares outside Japan fell 1.29%. Markets in mainland China remain closed for a holiday.


Overnight in the U.S., major indexes fell — the Dow Jones Industrial Average shed 346.93 points, or 1.15%, to 29,926.94. The S&P 500 declined 1.02% to 3,744.52, while the Nasdaq Composite was 0.68% lower at 11,073.31.

"Equities struggled as markets await the much-anticipated U.S. payrolls data … and as comments from Fed officials maintained a 'more is needed' vibe," ANZ Research analysts wrote in a Friday note.

Asian currencies to face more depreciation toward year-end, says Nomura

Asia currencies are "still in the mid phase" of depreciation and will continue to weaken against the U.S. dollar until the end of the year, said Craig Chan, global head of FX strategy at Nomura Securities

"Central banks in the region will have to think about whether they need to continue hiking interest rates to stabilize their currencies, or allow for more flexibility around currency depreciation," Chan said on "Street Signs Asia," adding that he expects to see the latter.

"We will continue to see intervention come through, but because of the reserve drainage, we've seen through this whole year in Asia, there has to be other actions," he said.

–Charmaine Jacob

Inflation could resurge if the Fed pivots too early, former Fed president says

The Fed has a very delicate and difficult period ahead, says former Kansas City Fed president
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Fed has a very delicate period ahead: Former Kansas City Fed president
Street Signs Asia

Former Kansas City Federal Reserve President Thomas Hoenig said the Fed could "reignite" inflation if it stops raising interest rates "too soon."

The Fed should not enter a rate-cutting cycle immediately after reaching the terminal rate, Hoenig told CNBC's "Street Signs Asia." Officials have signaled their intention to raise rates to 4.6% by 2023.

Speaking of the Fed's cycle of rate hikes, Hoenig said, "They need to stay there and not back off of that too soon to where they reignite inflation, say in the second quarter [of] 2023 or the third quarter."

"They have a very delicate and very difficult period ahead of them in terms of decision-making," he said.

— Jihye Lee

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The partner and senior portfolio manager at Ninepoint Partners, which manages more than $8 billion in assets, named three stocks for investors to cash in.

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Malaysia set to announce its budget for 2023

Malaysia's budget will carry an "even more pronounced" election focus now that speculation of a vote happening this year has grown, according to Mizuho.

Economist Lavanya Venkateswaran wrote in a note, "higher allocations towards cash handouts and other social transfers" are expected, but the government also needs to balance that with the "reality of fading commodity tailwinds in 2023," which will affect Malaysia's tax revenues.

"In walking a fine line between sticking to its fiscal consolidation agenda and playing up the election card, we suspect the governments' scope to announce more medium-term tax reforms (diversifying the tax base away from oil, for example) is limited," she wrote.

"The underlying assumption is that the government sticks to its stated fiscal consolidation agenda of narrowing the deficit to 5.0% of GDP from 2022-2024; this implies a deficit of 4.5-5.0% of GDP in 2023," the note said.

— Abigail Ng

CNBC Pro: Tesla or Nvidia? One will dominate in A.I., analyst says, giving it 50% upside

Tech's next frontier — artificial intelligence — is still in its adolescence, but offers significant growth opportunities for suppliers and users alike, according to Truist Securities.

Both Nvidia and Tesla offer ways to get exposure to AI, the analysts say, revealing their price targets on both stocks.

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Samsung posts decline in operating profit for the first time since late 2019

South Korean chipmaker Samsung Electronics announced a 31.7% drop in operating profit in the third quarter of 2022 compared with the same period a year ago, according to a preliminary earnings release.

Demand for semiconductors has slowed, the release showed.

Operating profit fell to 10.8 trillion Korean won ($7.65 billion), compared with 15.8 trillion won in the third quarter of 2021. That's the first decline in quarterly profits since the fourth quarter of 2019, data from Refinitiv Eikon showed.

Sales rose to 77 trillion Korean won in the July-to-September quarter, from 73.98 trillion won in the same period last year.

Shares of Samsung Electronics fell as much as 1.95% in Asia's morning.

— Abigail Ng