Asian Stock Market: Sell-off spurt as resilient US labor market drums hawkish Fed bets, oil recovers

Asian stocks are facing sheer pressure as upbeat US Employment report has driven hawkish Fed bets.
Janet Yellen’s visit to China to improve trade relations might strengthen the overall market mood.
Chances of BoJ’s intervention have increased as the central bank is expected not to exit from its ultra-dovish interest rate policy.

Sagar Dua FXStreet

Markets in the Asian domain have witnessed a steep fall after sensing a negative lead from S&P500. US equities faced a sharp sell-off as the robust addition of fresh payrolls in June has uplifted chances of more than one interest rate hike from the Federal Reserve (Fed).

The United States Automatic Data Processing (ADP) agency has reported that payroll figures doubled in June vs. expectations. In June, the US labor market has been flooded with fresh 497K fresh talent, higher than the expectations of 228K and the former release of 278K.

At the press time, Japan’s Nikkei 225 drops 0.53%, China A50 tumbles 0.80%, Hang Seng plunged 1.30% and Nifty50 remained flat.

Apart from the tight US labor market, ISM Services PMI also remained upbeat and added to filters of supporting hawkish monetary policy outlook.

The US Dollar Index (DXY) is expected to remain volatile ahead of the Nonfarm Payrolls (NFP) data, which will release at 12:30 GMT.

Chinese stocks have failed to capitalize on the visit of US Treasury Secretary Janet Yellen to China to avoid a trade war and improve relations. China’s Finance Minister said “We hope the US to take 'concrete' actions to create a favorable environment for the healthy development of economic, trade ties between China and US,” as reported by Reuters.

Meanwhile, chances of the Bank of Japan’s (BoJ) intervention in the currency market have increased as the central bank is expected not to exit from its ultra-dovish interest rate policy. BoJ Deputy Governor Shinichi Uchida crossed wires via Japan’s Nikkei news, reported Reuters, and ruled out an early end to the ultra-easy monetary policy while also defending the Yield Curve Control (YCC) policy.

On the oil front, oil prices delivered a V-shape recovery, recovering losses inspired by an upbeat US labor market report. The oil price has climbed to near the crucial resistance of $72.00 and is expected to elevate further as the impact of production cuts announced by Russia and Saudi has not faded yet.

Nikkei 225

Overview
Today last price	32437.7
Today Daily Change	0.00
Today Daily Change %	0.00
Today daily open	32437.7

Trends
Daily SMA20	33139.7
Daily SMA50	31481.3
Daily SMA100	29666.99
Daily SMA200	28445.17

Levels
Previous Daily High	32910.79
Previous Daily Low	32211.44
Previous Weekly High	33485.9
Previous Weekly Low	32445.67
Previous Monthly High	33966.85
Previous Monthly Low	30811.29
Daily Fibonacci 38.2%	32478.59
Daily Fibonacci 61.8%	32643.64
Daily Pivot Point S1	32129.16
Daily Pivot Point S2	31820.63
Daily Pivot Point S3	31429.81
Daily Pivot Point R1	32828.51
Daily Pivot Point R2	33219.33
Daily Pivot Point R3	33527.86

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

AUD/USD bounces off multi-month low, nears 0.6900

AUD/USD edges higher toward 0.6900 in the Asian session on Wednesday, recovering some of the previous day’s losses to its lowest level since March as the US Dollar stalls the hot US CPI-inspired rally amid hopes of a US-Iran peace deal. Meanwhile, hawkish comments from FOMC members have almost confirmed another December rate hike, which favors USD bulls and should cap the Aussie.

USD/JPY remains capped below 159.00 amid looming intervention risks

USD/JPY struggles to build on the previous day’s strong gains to a near one-month top as intervention risk supports the Japanese Yen while hopes of a US-Iran peace deal cap the safe-haven US Dollar. That keeps the pair's upside limited below 159.00, for now.

Gold puts the $4,000 mark to the test

Gold now accelerates its daily correction, challenging the key $4,000 mark per troy ounce on Wednesday. The precious metal’s continuation of the downward trend comes against the backdrop of a robust performance of the US Dollar, rising US Treasury yields across the board and rising bets of extra rate hikes by the Fed.

Crypto Today: Bitcoin, Ethereum and XRP struggle to find footing amid spot ETF outflows

Cryptocurrency prices are broadly consolidating near key lower support levels on Wednesday, led by Bitcoin, hovering around $74,000. Ethereum sits above $2,000 while its upside remains structurally capped. Ripple, meanwhile, holds delicately above $1.00.

Ten questions for China in 2027

2026 has been a year of slowing growth and increasing divergence within China's economy. We saw the gap between external and domestic demand, as well as between the new economy and the old economy, widen significantly. Here, we look ahead to the key questions facing China in 2027.

What the US CPI headline doesn’t tell you about inflation

Brent crude has fallen about a third since mid-October on hopes the Iran war is ending, but diesel, freight and fertiliser costs haven't followed. Those costs reach US consumer prices in stages through 2027 and could keep inflation high after gasoline gets cheaper.