I. Yesterday's News
International News
1. The dollar index, which measures the greenback against six major rivals, jumped about 1 percent and U.S. Treasury yields rose after a strong U.S. July payrolls report and comments from National Economic Council director Gary Cohn about lowering the U.S. corporate tax rate. The Dow Jones Industrial Average ended at its eighth straight record high on Friday, with gains in banks after data showed U.S. employers hired more workers than expected in July.

2. National Economic Council director Gary Cohn told Bloomberg TV on Friday that the 35 percent U.S. corporate tax rate should be more in line with the 24 percent average rate among other countries in the Organization for Economic Cooperation and Development.

3. U.S. employers hired more workers than expected in July and raised their wages, signs of labor market tightness that likely clears the way for the Federal Reserve to announce a plan to start shrinking its massive bond portfolio. The Labor Department said on Friday that nonfarm payrolls increased by 209,000 jobs last month amid broad-based gains. June's employment gain was revised up to 231,000 from the previously reported 222,000. Average hourly earnings increased nine cents, or 0.3 percent, in July after rising 0.2 percent in June. That was the biggest rise in five months. On a year-on-year basis, wages increased 2.5 percent for the fourth straight month. The New York Federal Reserve said on Friday it raised its estimate on U.S. gross domestic product for third quarter to 1.98 percent. The U.S. economy is on track to expand at a 3.7 percent annualized pace in the third quarter, the Atlanta Federal Reserve's GDP Now forecast

4. The U.S. Commerce Department said on Friday the trade gap decreased to $43.6 billion in June against economists' forecast of $45.0 billion. Canada's trade gap was C$3.6 billion ($2.9 billion), Statistics Canada said on Friday. May's figures were revised to show a wider shortfall of C$1.36 billion than initially reported C$1.09 billion. Canada's labor market added 10,900 jobs in July, with 35,100 of those full-time positions. Canadian unemployment rate was down to 6.3 percent in July from 6.5 percent in June. Fitch Ratings affirmed Sweden's's credit note at 'AAA' and said that the outlook was stable.

Domestic News
5. As international oil prices increased, the retail prices of gasoline and diesel will rise by 175 yuan and 165 yuan per tonne respectively from Friday, according to the National Development and Reform Commission (NDRC).

6. An editorial in People's Daily the main official paper of the Chinese Communist Party, amplified on Friday that Indian border troops illegally crossed the border into Chinese territory, saying China will take whatever measures are necessary to safeguard its legitimate rights and interests. Chinese defense ministry has urged India to immediately pull back the trespassing troops to the Indian side of the boundary. Ren Guoqiang, a spokesperson of the ministry, made the remarks, urging the Indian side to give up the illusion of its delaying tactic.

7. U.S. President Donald Trump's threat to investigate China's intellectual property and trade practices is valid, but his administration may not be up to the delicate task of carrying out a new China probe without sparking a damaging trade war. Lobbyists said Trump was right to criticize China on trade, but they expressed concern about general disorganization and inconsistency at the White House and warned that Trump might make matters worse with China if he follows through.

8. In a new measure to push forward the supply-side reform in the housing market, Beijing is planning to introduce homes with joint property rights shared between the government and buyers. According to a document published by local authorities Thursday, "new Beijingers,"  will be able to buy at least 30 percent of the homes. Five years after purchase, owners can sell their shares based on the market price.

9. The opening of capital project shall be carried forward in an orderly way with focus on the real economy to prevent financial risks, said an article by Zhan Yue from Huazhong University of Science and Technology in People's Daily.

10. Total assets and liability of Beijing's banking sector dropped 1.8 percent and 1.9 percent between January and June, as interbank assets and and liability dropped 29.8 percent and 13.5 percent compared with early 2017, according to Jiang Ping, deputy director of the municipal banking regulatory bureau.

II. Market Overview
FX
1. Global Market
The U.S. dollar was set for its biggest one-day gain against a basket of major currencies so far this year after a strong U.S. July payrolls report and comments from National Economic Council director Gary Cohn about lowering the U.S. corporate tax rate. The dollar index, which measures the greenback against six major rivals, jumped about 1 percent to a one-week high of 93.774, set to post its first weekly percentage gain in four weeks, the euro was still set to post its fourth straight weekly percentage increase against the greenback. Against the yen, the dollar gained as much as 0.9 percent to a one-week high of 111.04 yen. The dollar touched 0.9763 franc, its highest against the Swiss currency in more than six weeks. The euro fell more than 1 percent against the dollar to a four-day low of $1.1729.

2. Home Market
China's yuan rebounded against the dollar in the morning session on Friday, with the midpoint rates hitting an over 9-1/2-month high. Yuan's prices steadied in the session ahead of U.S. job report. An estimated strong report would pulled yuan back to around 6.75.

Precious Metals
Gold fell 1 percent on Friday after better-than-expected U.S. jobs data boosted the beleaguered dollar and potentially cleared the way for the U.S. Federal Reserve to raise interest rates for a third time this year. Spot gold was down 0.8 percent at $1,257.66 an ounce by 1802 GMT, after falling 1.1 percent. It was on track to end the week down 0.9 percent following three straight weeks higher. U.S. gold futures for December delivery settled down 0.8 percent at $1,264.60.

Commodities
1.Crude Oil
Oil prices rose on Friday after a strong U.S. jobs report bolstered hopes for growing energy demand, but crude prices declined for the week, pressured by rising OPEC exports and strong U.S. Output. Global benchmark Brent futures gained 41 cents, or 0.8 percent, to settle at $52.42 a barrel, while U.S. West Texas Intermediate crude rose 55 cents, or 1.1 percent, to settle at $49.58. For the week, the Brent and WTI front-months were each down less than 1 percent.

2.Base Metals
Zinc prices clawed higher on Friday, getting a boost from another surge in Chinese steel prices and from investors who are still bullish about shortages of the metal developing. Benchmark zinc on the London Metal Exchange closed 0.7 percent higher at $2,812 a tonne. Three-month LME copper ended 0.3 percent firmer at $6,372 a tonne.

U.S. Treasuries
1. U.S. Bonds
U.S. Treasury yields rose on Friday after data showed that U.S. employers hired more workers than expected in July, while wage growth also met economists' expectations. Benchmark 10-year notes fell 10/32 in price to yield 2.26 percent, up from 2.23 percent late on Thursday. The yield curve between five-year notes and 30-year bonds steepened to 102 basis points, after briefly flattening below 100 basis points after the employment report, the lowest level since July 11.

2. Chinese bonds
China's shorter-dated cash bonds outperformed the longer-dated bonds in the morning session, with the T-bond futures edging up. Yields of shorter-dated cash bonds extended losses on loosing liquidity at beginning of month. But the market, as a whole, was still consolidating with most institutions staying on the sidelines.

Stock Market
1. U.S. Equities
The Dow Jones Industrial Average ended at its eighth straight record high on Friday, with gains in JPMorgan Chase and other banks after data showed U.S. employers hired more workers than expected in July. The Dow Jones Industrial Average rose 66.71 points or 0.3 percent to end at 22,092.81, an all-time high. The S&P 500 gained 4.67 points or 0.19 percent to 2,476.83 and the Nasdaq Composite added 11.22 points or 0.18 percent to 6,351.56. For the week, the Dow climbed 1.2 percent, the S&P 500 rose 0.2 percent and the Nasdaq shed 0.4 percent.

2. Hong Kong Equities
Hong Kong stocks inched up on Friday to post their fourth consecutive week of gains, helped by a robust rally in resources and financial firms. The strength on Wall Street also boosted risk appetite, as the Dow Jones Industrial Average edged up to a seventh straight record high on Thursday. The Hang Seng index rose 0.1 percent, to 27,562.68 points, while the China Enterprises Index was unchanged at 11,003.08 points.

3. China Equities
China's Shanghai Composite Index closed lower on Friday. The losses picked up late in the session, while cyclical and national defense names bucked the trend. In the near term, the index will be kept in check at around 3,300 due to lack of drivers.