Asian stocks rose slightly as traders awaited Friday’s U.S. jobs report

Stocks across Asia ticked up Thursday as investors looked ahead to Friday’s U.S. employment figures and waited on Congress to approve a $3.3 trillion tax-and-spending plan.

Overnight in New York, major indexes hit fresh highs according to Reuters. This happened after Trump announced a trade pact with Vietnam. The agreement calls for a 20% U.S. tariff on Vietnamese imports, while Vietnam will levy no duties on American goods. The news bolstered hopes for a similar deal with India.

Vietnamese equities rallied overnight to three-year highs, driven by curiosity about the U.S.–Vietnam trade terms. President Trump posted on Truth Social that Vietnam would adopt “ZERO Tariff” on U.S. goods, further fueling optimism.

In Asian markets, the MSCI index of Pacific shares ex-Japan climbed 0.2%, closely under its highest level in nearly four years. Tokyo’s Nikkei was flat. China’s CSI 300 index rose 0.2%, even as Hong Kong’s Hang Seng reduced by 0.6% after data revealed that China’s services activity grew at its slowest speed over the last nine months during June.

Futures tied to the Nasdaq and S&P 500 were mostly unchanged in Asian trading, with investors treading lightly until key U.S. developments materialize.

Europe futures Rise while U.S treasury yields slip and dollar drops to 3-year low

In Europe, futures from IG pointed to a stronger open. FTSE 100 up 0.3% at 8,799; DAX up 0.2% at 23,836; CAC 40 up 0.2% at 7,757; and FTSE MIB up 0.15% at 39,926.

On Wednesday, UK bond yields and share prices fell after Finance Minister Rachel Reeves became emotional in Parliament during a welfare debate. Officials said she was dealing with a personal issue, and Prime Minister Keir Starmer expressed his support.

All eyes are on Friday’s jobs numbers, widely viewed as the key market mover ahead of the Fed’s next decision. “These labor market indicators warn of the risk that the unemployment rate could spike to 4.4%, the highest since October 2021,” said Tony Sycamore, analyst at IG. “This would quickly increase the probability of a July Fed rate cut to around 70%.”

Despite that, futures put only a 25% chance on a cut in July. The Fed has kept borrowing costs unchanged all year, drawing criticism from President Trump, who wants rates reduced from the current 4.25 – 4.50 percent range down to 1%.

In bond markets, traders were on edge before the jobs data. The yield on 10-year Treasuries dipped two basis points to 4.265%, while the two-year note fell to 3.77%. The dollar also weakened, sliding to the lowest point against major currencies in more than 3 years amid concerns about Fed independence.

Currency markets saw the euro nudge up 0.1% to $1.1807, near Tuesday’s four-year peak of $1.1829, while sterling recovered 0.8% of its recent losses. Gilt yields jumped 23 basis points once, marking the largest single-day rise since 2022, October.

In commodities, oil prices eased after a 3% rise overnight on news Iran stopped cooperating with a UN nuclear watchdog. U.S. crude fell 0.4% to $67.20 a barrel, and Brent dipped 0.4% to $68.84.

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