INDIA: HSBC INDIA AUGUST SERVICES PMI RISES TO 62.9

Gold prices rose strongly on Friday as US yields and the US dollar fell following weaker-than-expected US payroll data. The increase in the US effective tariff is also adding risks to the growth outlook. Bullion started today trending lower reaching a trough of $3345.12/oz before beginning to recover. It is currently down 0.1% to $3359.6. The USD index is 0.1% lower but the 2-year yield slightly higher. 

• Silver also trended down at the start of the session but after a low of $36.678 it has bounced back and is now up 0.2% to $37.108, close to the intraday high.
• Equities are mixed with the Nikkei down 1.5% but S&P e-mini up 0.4% and Hang Seng +0.5%. Oil prices are slightly lower with WTI -0.2% to $67.22/bbl. Copper is down 0.2%.
• Later final US June orders, Swiss July CPI and Spanish July unemployment print.  

As the market digested the poor jobs report from the US, markets appeared to have found a silver lining and extrapolated rate cuts.  China and the KOSPI ignored the falls in Japan to post modest gains as South East Asian markets.   In Korea, the KOSPI received a boost on comments that the ruling Democratic Party is reviewing its position on capital gains tax whilst China's tech stocks got a boost from news that US chip exports may be delayed.

•  China's Hang Seng has started the week on a positive footing, rising +0.50% whilst onshore bourses were mixed.  The CSI 300 is unchanged on the day along with the Shenzhen Comp and the Shanghai Comp has had a mildly positive start, rising +0.20%.  
• Taiwan's TAEIX is lower by -0.65%
• The KOSPI is one of the better regional performers, rising +0.95%.  
• In Malaysia, the FTSE KLCI has a very strong finish to Friday but has given some of those gains back, falling -0.33%.
• The Jakarta Composite had a very strong July but is off -0.35% to start the week.  
• The FTSE Straits Times in Singapore is up +0.80% whilst the PSEi in the Philippines is down -0.45%.  
• India's NIFTY 50 finished down last week yet has seen well known EM investor Mark Mobius calling Indian stocks a 'buy' as the tariff battle continues.  

Japan Sep futures tested above 139.00 in early trade, but sit back at 138.68, +.60 in latest dealings. After spiking early in response to the US Tsy futures rise we have settled into a tight range for much of the session after dipping back under 138.80. 

• In the cash JGB space, yields are holding lower, but are away from worst levels. The 10yr was last close to 1.505%, earlier we got to 1.472%. This was lows back to early July in yield terms. For the 2-7yr tenors we are 5-7bps off in yield terms. For the 20-40yr tenors we have seen a steadier backdrop.
• Focus remains on the fiscal backdrop, particularly as opposition parties continue to push for sales tax cuts. So far the LDP has resisted such moves as it is worried around what the market impact could be on further fiscal position deterioration.
• Note tomorrow we get the 10yr debt auction locally.
• On the data front today we just had the July monetary base data. Focus will be on Wednesday's June labor cash earnings figures.