Asian stocks and other riskier assets such as commodities fell on Monday as investors remained cautious about the outlook for the global economy and corporate earnings despite better-than-expected U.S. jobs numbers last week.
Wall Street stocks dipped late on Friday as an unexpected drop in the U.S. unemployment rate was overshadowed by concerns about the earnings season, which kicks off with Alcoa Inc on Tuesday, and S&P 500 futures traded in Asia eased on Monday.
“It (the jobs number) looks good if you were worried about an imminent collapse back into recession or if you had performed badly in a presidential debate,” said Russell Jones, global interest rate strategist at Westpac bank in Sydney, in a note.
“But the reality is that it remains consistent with a U.S. economy growing around or a little below trend, no more.”
S&P 500 earnings for the third quarter are forecast to have fallen 2.4 percent from the year-earlier period, which would be the first decline in three years, according to Thomson Reuters data.
MSCI’s broadest index of Asia Pacific shares outside Japan fell 0.7 percent. Japanese financial markets were closed for a public holiday.
Equity markets have been rallying since hitting their nadir for the year in early June, receiving a renewed burst of impetus last month when major central banks rolled out fresh measures to support fragile economies.
MSCI’s Asia Pacific ex-Japan and All Countries World Indexes are both up around 13 percent over the year-to-date.
But with the euro zone sliding back towards recession amid a still unresolved debt crisis and the U.S. recovery far from secure, investors remain reluctant to chase growth-sensitive riskier assets too aggressively.
