Asian markets mostly down, pound dips after London attack

HONG KONG: Asian markets began the week mostly lower Monday as investors mulled the impact of a weekend terror attack in London that saw the pound lose ground in early trading.

A weaker-than-expected US employment report also weighed, with wage growth and hiring coming in below expectations and testing confidence in the global outlook.

In Tokyo the Nikkei 225, which ended Friday at its highest level for nearly two years, extended gains with a 0.1 percent advance. But Hong Kong slipped 0.1 percent, Shanghai shed 0.3 percent and Sydney was off 0.8 percent while Singapore also dipped 0.1 percent. Seoul was flat.

The dollar fetched 110.58 yen, from 110.44 yen in New York, but well off the levels around 111.60 yen earlier Friday in Asia owing to the soft US jobs data.

"The (jobs) numbers were solid enough to keep the (Federal Reserve) on track for a June hike, but not strong enough to erase uncertainties over the future Fed funds rate's path beyond June," Rodrigo Catril, Currency Strategist at National Australia Bank said in a commentary.

Despite rallies in the US stocks, the lack of wage inflation in the report prompted a decline in US Treasury yields that led to the dollar slip across the board, analysts said.

While Fed policy makers will remain tight-lipped ahead of next week's rate decision, investors will have plenty to chew on in world politics in the coming days.

Britain goes to the polls on Thursday still reeling from Saturday's attack that saw seven killed and 48 hurt in central London, in the third attack in the country in three months.

The pound slipped to $1.2866 from $1.2889 dollars in New York.

"Britain's election looked like a shoe-in for the Prime Minister (Theresa May) but polls now have her leading by a whisker," NAB said in a separate commentary. "Escalating terrorism adds to the unease," it said.

Also on Thursday the pressure on Donald Trump's administration is likely to be thrown into sharp relief when former FBI Director James Comey testifies before Congress following his dismissal by the US president.

The weaker dollar supported oil prices, which rebounded in early Asian trading Monday.

"The weak dollar and the US driving season are minor factors that is helping to support oil prices, but the outlook is technically quite bearish," said Margaret Yang, market analyst at CMC Markets.

- Key figures around 0230 GMT -

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Tokyo - Nikkei 225: UP 0.1 percent at 20,205.65 (break)

Hong Kong - Hang Seng: DOWN 0.1 percent at 25897.04

Shanghai - Composite: DOWN 0.3 percent at 3,096.03

Euro/dollar: DOWN at $1.1273 from $1.1283 at 2100 GMT on Friday

Dollar/yen: UP at 110.58 yen from 110.44 yen

Pound/dollar: DOWN at $1.2866 from $1.2889

Oil - West Texas Intermediate: UP 29 cents at $47.95 per barrel

Oil - Brent North Sea: UP 31 cents at $50.26 per barrel

New York - Dow: UP 0.3 percent at 21,206.29 (close)

London - FTSE 100: UP 0.1 percent at 7,547.63 points (close)