SYDNEY- Asian shares steadied on Monday as US stock futures made cautious gains ahead of US inflation data later in the week, while the euro touched a seven-year top on the yen amid wagers of European Central Bank tightening.
Oil prices firmed after Saudi Arabia raised prices sharply for its crude sales in July, an indicator of how tight supply is even after OPEC+ agreed to accelerate its output increases over the next two months.
MSCI’s broadest index of Asia-Pacific shares outside Japan inched up 0.1 percent, while Japan’s Nikkei recouped early losses to gain 0.3 percent.
S&P 500 futures added 0.4 percent and Nasdaq futures 0.6 percent. EUROSTOXX 50 futures rose 0.6 percent and FTSE futures 0.9 percent.
Chinese blue chips climbed 1.2 percent after a survey confirmed service sector activity contracted in May, but the Caixin index did improve to 41.4 from 36.2.
Markets will be on tenterhooks for the US consumer price report on Friday, especially after EU inflation shocked many with a record high last week.
Forecasts are for a steep rise of 0.7 percent in May, though the annual pace is seen holding at 8.3 percent while core inflation is seen slowing a little to 5.9 percent.
A high number would only add to expectations of aggressive tightening by the Federal Reserve with markets already priced for half-point hikes in June and July and almost 200 basis points by the end of the year.
Some analysts thought Friday’s upbeat payrolls report suggested the Fed was on track for a soft landing.
“May’s numbers came in about as good as the Fed could expect,” said Jonathan Millar, an economist at Barclays.
“It’s a good sign that the Fed’s plans to cool the labor market are playing out favorably so far, with solid gains in employment continuing to generate steady income gains that will help allay recession worries, for the time being.”
