(Jan 9): Asian equities swung between modest gains and losses, with investors bracing for Friday’s US payrolls report and a possible Supreme Court ruling on President Donald Trump’s tariffs.
Shares opened higher in Japan and Australia, while South Korea lagged. Investors rotated out of technology shares into consumer discretionary and energy stocks, following a similar pattern in US trading that saw selling in tech behemoths such as Nvidia Corp.
Treasury futures inched up and mortgage backed securities rallied after Trump said he was directing the purchase of US$200 billion ($257.18 billion) of mortgage bonds. A Bloomberg gauge of the dollar was set for its best week since November.
The rebound in equities after April’s tariff-driven slump faces a key test from the court ruling, just as investors brace for US jobs data that will offer clues on the Federal Reserve’s (Fed) path for interest rates. In a defensive shift, money has rotated out of richly valued tech giants into smaller companies, tempering the artificial intelligence-led gains of recent years.
“It is unclear at this point whether this is just a breather or a full rotation,” said Paul Ticu at Calamos Investments. “Markets are still trying to figure out a direction.”
See also: Asian stocks stay range-bound, Treasuries hold gains
The Russell 2000 index of smaller US companies has beaten the Nasdaq 100 by around four percentage points in the first five sessions of 2026, the second-best outperformance to start a year on record.
Technology sold off in the US, while most other sectors rallied, reinforcing the view that tech was being used as a source of funds as investors rotate into cyclical, defensive, and domestic-growth exposures, said Chris Murphy, derivatives strategist at Susquehanna International Group LLP, in a note on Thursday.
Investors will be on guard for US jobs data set to land later on Friday. Economists surveyed by Bloomberg anticipate 70,000 new positions were added to the US economy in December, slightly higher than the prior month, while the unemployment rate is expected to fall to 4.5%.
See also: Record Asian stock rally eases on Japan, oil falls
Jobs data will help illuminate the path ahead for US interest rates. Money markets are pricing in at least two quarter-point cuts from the Fed in 2026.
The Supreme Court is also poised to decide the fate of most of Trump’s tariffs as soon as Friday. Hundreds of companies have already lined up hoping to recoup their share of the billions of dollars in duties paid so far.
In other corners of the market, oil extended its gain as investors monitored developments in Venezuela and Iran. Silver retreated further from its record struck earlier in the week. Gold also fell.
Mortgage bonds rose and home-lender stocks rallied after Trump’s move to bring down the cost of housing. There are roughly US$9 trillion worth of agency mortgage bonds outstanding.
In Asia, data set for release includes inflation and producer prices for China, consumer confidence in Indonesia, and industrial production in Malaysia.
Investors are still focused on the dispute between China and Japan. On Thursday, China said export control on dual-use items to Japan won’t impact civilian use, and that parties engaged in normal civilian trade “have absolutely no need to worry”.
Corporate news:
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- Rio Tinto Group is in talks to buy Glencore plc to create the world’s biggest mining company with a combined market value of more than US$200 billion, a little over a year after earlier talks between the two collapsed. Rio Tinto shares fell 5%.
- General Motors Co will take another US$6 billion in charges tied to production cutbacks in its electric vehicle and battery operations as the financial fallout spreads from the weakening US market for electric vehicles.
- Paramount Skydance Corp reaffirmed its offer to buy Warner Bros Discovery Inc for US$30 a share, insisting its hostile bid is superior to one from Netflix Inc despite multiple rejections by Warner Bros’ board.
- Shell plc said its oil trading performance significantly worsened in the fourth quarter as crude prices slumped.
Some of the main moves in markets:
Stocks
- S&P 500 futures were unchanged as of 10.07am Tokyo time on Friday
- Japan’s Topix rose 0.3%
- Australia’s S&P/ASX 200 rose 0.3%
- Euro Stoxx 50 futures fell 0.4%
Currencies
- The Bloomberg Dollar Spot Index was little changed
- The euro was little changed at US$1.1653
- The Japanese yen fell 0.1% to 157.08 per dollar
- The offshore yuan was little changed at 6.9820 per dollar
Cryptocurrencies
- Bitcoin was little changed at US$91,207.07
- Ether was little changed at US$3,113.98
Bonds
- The yield on 10-year Treasuries was unchanged at 4.17%
- Japan’s 10-year yield advanced 1.5 basis points to 2.090%
- Australia’s 10-year yield advanced one basis point to 4.68%
Commodities
- West Texas Intermediate crude rose 0.6% to US$58.08 a barrel
- Spot gold fell 0.5% to US$4,457.39 an ounce
Uploaded by Tham Yek Lee
