Asia stocks set for muted start; treasuries slip

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NEW YORK/TOKYO (Dec 6): Asian stocks looked set for a muted open as traders awaited news on the U.S. job market and a looming scheduled American tariff hike on Chinese goods. Bonds and the dollar fell.

Futures were little changed in Japan, Australia and Hong Kong. U.S. shares closed slightly higher Thursday. Treasury yields climbed after data showed jobless claims slumped to a seven-month low, signaling resilience in the labor market ahead of Friday’s employment report. Oil slipped after a volatile
session as OPEC failed to impress traders with what appeared to be a cosmetic revision to output quotas.

Investors are waiting for signs the U.S. and China will reach a truce in a dispute that’s led to the biggest volley of tariffs since the 1930s. Equities rebounded after President Donald Trump’s remarks that negotiations were “moving along well,” though gains were briefly capped by a news report that
the U.S. and China remained at odds over agricultural purchases.

“Things are looking modestly positive, but that can change on a dime,” Michael Reynolds, investment strategy officer at Glenmede Trust Co. “We’re expecting trade to dominate the narrative for the next week and a half as we approach that December 15 deadline.”

The U.S. jobs report will offer a gauge on the outlook for spending, with consumers vital to sustaining the U.S. expansion and validate Federal Reserve Chairman Jerome Powell’s view that rates can stay on hold following three cuts. The flip side for investors is that strong payroll gains could also reduce the incentive for the Trump administration to do a deal with China.

Elsewhere, oil prices sputtered as OPEC reached an agreement that adjusts its official production targets, but removes few barrels from a market that’s forecast to return to surplus early next year.

Here are some key events coming up this week:

* U.S. Labor Department figures are expected to show Friday that 179,000 workers were added to nonfarm payrolls last month -- one of the highest forecasts this year -- with the jobless rate holding at 3.6%. Average hourly earnings are projected to grow 3% year-on-year, same as in October.

These are some of the main moves in markets:

Stocks

* Nikkei 225 futures rose 0.1%.

* S&P/ASX 200 futures climbed 0.1%.

* Hang Seng futures rose 0.1%.

* The S&P 500 climbed 0.2%.

* The Stoxx Europe 600 Index fell 0.1%.

Currencies

* The Bloomberg Dollar Spot Index lost 0.2% Thursday.

* The euro increased 0.2% to $1.1104.

* The Japanese yen added 0.1% to 108.75 per dollar.

* The offshore yuan rose 0.2% to 7.0413.

Bonds

* The yield on 10-year Treasuries climbed three basis points to 1.81%.

Commodities

* West Texas Intermediate crude fell 0.2% to $58.32 a barrel.

* Gold rose 0.1% to $1,476 an ounce.