Key Takeaways
- US Dollar hits two-week lows as June non-farm payrolls grew by only 57,000, sharply missing expectations and cooling bets for a near-term Federal Reserve rate hike.
- South Korea's President Lee announced a massive 896 trillion won ($578 billion) investment plan and a new "control tower" committee to secure "absolute supremacy" in the global AI and chip markets.
- Singapore’s Straits Times Index (STI) surged to a record high of 5,253.99, driven by resilient banking performance and a structural boost from the government's equity development program.
- Japanese Government Bond (JGB) yields continued their ascent, with the 30-year yield hitting 4.045% amid persistent concerns over fiscal expansion and yen volatility.
- Major South Korean oil refiners, including SK Energy and GS Caltex, face indictment over alleged 26 trillion won price collusion following recent geopolitical instability.
Currency and Bond Markets
The US Dollar Index (DXY) retreated toward 100.70 after a "Goldilocks" jobs report showed US payroll growth slowed to just 57,000 in June. This cooling labor market has led traders to pare back expectations for a September rate hike, with CME FedWatch tools now pricing in a 52% probability, down from 64% earlier in the week.
In Japan, the Yen (JPY) remains in sharp focus, hovering near 40-year lows despite a slight rebound on intervention risks. Meanwhile, the 30-year Japanese government bond yield climbed to 4.045%, and the 5-year yield rose to 1.930%, as investors react to Prime Minister Sanae Takaichi’s expansionary fiscal plans and the Bank of Japan's shifting policy stance.
Semiconductor and Tech Surge
South Korea is doubling down on its technology sector, with President Lee Jae Myung set to launch a dedicated committee in August to bolster chip competitiveness. The initiative includes a W800 trillion second chip belt and a nationwide expansion of AI data centers, with major participation from Samsung Electronics (005930) and SK Hynix (000660).
Chinese tech shares also showed strength at the open, with the CSI All Share Integrated Circuits Index and the STAR Chip Index both poised to start the session up 2%. This follows a period of heavy rotation, as analysts suggest the recent pullback in tech offers a favorable entry point for long-term positioning.
Regional Economic Indicators
Australia reported a cooling of inflationary pressures, with the Melbourne Institute Inflation Gauge falling 0.4% month-on-month in June. The year-on-year figure moderated to 3.9% from 4.4%, providing the Reserve Bank of Australia (RBA) with potential breathing room as it monitors a weakening job market, evidenced by a 0.2% drop in ANZ-Indeed Job Advertisements.
In Southeast Asia, Singapore’s benchmark index reached an all-time peak, supported by heavyweights like DBS Group (D05) and Singapore Airlines (C6L). The market continues to benefit from its safe-haven status and the government's S$6.5 billion Equity Market Development Programme, which has reinforced institutional participation.
Corporate and Regulatory Developments
South Korean prosecutors have indicted four major refiners—SK Energy, GS Caltex, S-Oil (010950), and HD Hyundai Oilbank—on charges of price collusion. Authorities allege the firms coordinated to hike fuel prices by 30–40 won per liter despite holding sufficient crude reserves, with the total scale of the collusion estimated at 26 trillion won.
In the commodities space, Shanghai tin futures surged over 4%, reaching 41,436 yuan per metric ton. This move reflects broader volatility in industrial metals as markets weigh uneven economic recovery signals from China against a weakening US dollar.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.