(Corrects para 21 to make clear that sharpest rise in VIX index
since Feb 2020 was last week not this week, no other changes to
* Didi delisting plans unnerve jittery markets; jobs data
* Oil heading for weekly loss
* U.S. 2-year yields track toward biggest weekly jump in
SYDNEY, Dec 3 (Reuters) - Asian stocks wobbled and
risk-sensitive currencies in the region sagged on Friday as
investors bet inflation will prompt U.S. rate rises next year,
even with the new Omicron coronavirus variant casting a cloud
over the outlook.
S&P 500 futures traded just below flat by afternoon
in Hong Kong, recovering a larger drop earlier when news that
Chinese ride-hailing giant Didi would delist in New York revived
geopolitical and tech regulation worries.
MSCI's broadest index of Asia-Pacific shares outside Japan
fell 0.4%. Japan's Nikkei touched a
two-month low and is set for a 3% weekly fall.
The risk-sensitive Australian dollar flirted with a
one-year low and two-year Treasury yields, which
track short-term U.S. interest rate expectations, looked set to
log their sharpest one-week jump in more than two years.
"Just about everyone at the Fed now says tapering needs to
be accelerated and rate hikes happen far sooner than we had
thought," said Rabobank global strategist Michael Every.
"The curve flattening we see speaks volumes on that."
Federal Reserve Chair Jerome Powell began the shift this
week by saying the bank will discuss a faster taper at its
meeting this month, prompting bets that near-term hikes end up
curbing future growth, inflation and ultimately rates.
The gap between two-year and 10-year Treasury yields
has slammed 16.6 basis points tighter this week,
the sharpest curve flattening since June 2020. Ten-year yields
held at 1.4410% on Friday, down 4.4 bps this week.
U.S. labour data, due at 1330 GMT and expected to show
550,000 jobs created last month, is the next focus for bond
"A print above 550,000 jobs should see the faster Fed-taper
trade reassert itself," said Jeffrey Halley at brokerage OANDA.
European equity futures and FTSE futures
were last up about 0.4%.
Oil, another growth proxy, has also taken a beating this
week and although it steadied on Friday, with Brent crude
futures at $70.89 per barrel. It is on course for a 2.5%
weekly fall and is 18% below a three-year high hit in October.
Oil cartel OPEC and its allies agreed on Thursday to go
ahead with planned production increases.
While plans by Didi to shift its listing to Hong
Kong were not altogether unexpected, the news of its U.S.
delisting still worsened the fragile mood.
It also capped a bleak few hours for investors in the
sector, after Southeast Asia's ride hailing titan Grab
fell 20% on its Nasdaq debut.
Shares in Japanese conglomerate SoftBank, exposed
to both stocks, slumped 3% to a 14-month low - with added
disappointment from a U.S. regulatory challenge to a takeover of
SoftBank-owned chipmaker Arm by Nvidia.
Tech shares in Hong Kong dropped to a two-month
"Delistings starting to happen gives some jitters over the
uncertainty as to how this impacts on the broader U.S.-China
picture," said Bank of Singapore analyst Moh Siong Sim.
In the United States, the Dow Jones Industrial Average's
1.8% jump on Thursday was its biggest one-day rise since
March, but it is still tracking toward fourth weekly loss in a
CBOE's volatility index, sometimes referred to as
Wall Street's "fear gauge", last week had its sharpest one-week
leap since February 2020 but is set to end this week a touch
lower. Implied volatility gauges in currency markets are also
surging, even if Friday trade was calm.
The euro was steady at $1.1299 and the yen
held at 113.23 per dollar, while the Australian and
New Zealand dollars slipped - with the Aussie briefly hitting a
one-year low just under 71 cents.
Traders will need to wait at least another week or so for an
early read on Omicron's virulence or vaccine resistance.
(Reporting by Tom Westbrook; Editing by Sam Holmes)