In This Article:
* Asian stock markets : https://tmsnrt.rs/2zpUAr4
* S&P 500 futures slip as riots add to economic woe
* Asia markets hold steady for the moment
* Busy week sees ECB meet, U.S. payrolls report
By Wayne Cole
SYDNEY, June 1 (Reuters) - Asian share markets started on a cautious note and gold gained on Monday as images of riots in burning U.S. cities unnerved investors already tense over Washington's power struggle with Beijing.
E-Mini futures for the S&P 500 retreated 0.5% in early action, while gold rose 0.77% to $1,739 an ounce. Oil prices also slipped, while sovereign bonds picked up the usual safe-haven bid.
MSCI's broadest index of Asia-Pacific shares outside Japan edged up 0.2%, as did Japan's Nikkei.
"If American consumers were reluctant to come out of their Covid19 lockdown cocoon, fearing a secondary spreader with police cars ablaze, freeways blocked, and videos of mass looting shared through social media like wildfire, they're not going to feel any safer,' said Stephen Innes, chief global markets strategist at AxiCorp.
Major U.S. cities were cleaning up streets strewn with broken glass and burned out cars as curfews failed to stop confrontations between activists and law enforcement.
Protesters have flooded streets after weeks of lockdowns during the coronavirus pandemic that threw millions out of work and hit minority communities especially hard.
The turmoil was a fresh setback for the economy which was only just emerging from a downturn akin to the Great Depression. Following poor data on spending and trade out on Friday, the Atlanta Federal Reserve estimated economic output could drop a staggering 51% annualised in the second quarter.
The May jobs report due out on Friday is forecast to show the unemployment rate surged to 19.8%, smashing April’s record 14.7%. Payrolls are expected to drop by 7.4 million, on top of the 20.5 million jobs lost the previous month.
"Current unemployment numbers go far beyond what has been experienced in any post-war recession," wrote Barclays economist Christian Keller in a note.
"To the extent that some sectors may never return to pre-pandemic business-as-usual, labour faces a substantial challenge to reallocate workers," he added. "Such a process could be a matter of years rather than months or quarters and in the meantime it would weigh on consumer demand."
In Asia, an official business survey from China over the weekend showed its factory activity grew at a slower pace in May but momentum in the services and construction sectors quickened, pointing to an uneven recovery.