It is actually leading a rally in Asian equities, driven by strong figures of U.S. employment that have allayed recession fears and then tempered the expectations of further rate cuts at the Federal Reserve. Japan’s benchmark Nikkei 225 jumped 2% in early trading sessions, reflecting investor optimism citeturn0search67.
The September U.S. nonfarm payrolls report revealed a gain of 254,000 jobs—that is, the highest increase in six months—while also reporting unemployment to fall to 4.1% citeturn0search0. Labor market strength from out of the blue reinforces the perception that the U.S. economy is stronger than thought and significantly dents expectations for aggressive rate cuts by the Fed in the near term.
The US dollar traded at a seven-week high versus the Japanese yen in currency markets following the upbeat jobs data as well as reduced chances for further rate cuts, according to citeturn0search67. A softer yen often helps Japanese exporters, contributing to a positive momentum in the stock market of Japan.
The U.S. employment report had sent waves through the other Asian markets, and Australia’s benchmark index rose 0.12%, with South Korea’s Kospi up 0.5% citeturn0search35. These are cases only to demonstrate how interconnected global markets are and how much influence U.S. economic indicators may exert on the mood of international investors.
