Another cautious start likely for Asian stocks

ASIAN stocks are seen starting fairly flat today after shares on Wall Street dipped and as the market looks ahead to key US jobs data later in the day. The main US share indices fell by up to 1 per cent, with technology and consumer staples the biggest losers, as investors awaited the closely-watched US non-farm payrolls report, which is forecast to show job losses of 320,000 in July.

British and European shares gained by 0.9 per cent and 0.4 per cent respectively, driven by financial stocks after the Bank of England said it would expand the size of its quantitive easing programme.

Both the Bank of England and the European Central Bank kept their benchmark interest rates unchanged, with ECB president Jean-Claude Trichet warning economic activity was likely to remain weak through the rest of the year.

Japanese shares are projected to open slightly higher, with Nikkei futures traded in Chicago 55 points above the last closing level in Osaka. However, Australian markets are seen weaker, with September index futures at 4,274, a 52-point discount to the underlying S&P/ASX 200 index’s close yesterday.

The US dollar was higher as the mood of caution prompted a move to safer havens, while sterling plunged on the news of further quantitive easing from the Bank of England. Oil prices pulled back from six-week highs, knocked by weakness on Wall Street. - Reuters