I. Yesterday’s News
International News

1. The U.S. economy created more jobs than expected in June, but steady wage gains pointed to moderate inflation pressures that should keep the Federal Reserve on a path of gradual interest rate increases this year. Nonfarm payrolls rose by 213,000 jobs last month. The unemployment rate rose to 4.0 percent. Average hourly earnings gained five cents, or 0.2 percent in June after increasing 0.3 percent in May. Economists polled by Reuters had forecast nonfarm payrolls increasing by 195,000 jobs last month and the unemployment rate steady at 3.8 percent.

2. Prime Minister Theresa May agreed Britain's Brexit negotiating position on trade and customs with her cabinet on Friday. The European Union's Brexit negotiator Michel Barnier said on Friday he would assess the negotiating position agreed by British Prime Minister Theresa May and her cabinet to see if it was workable and realistic.

3. Latin American currencies are likely to recoup some recent losses in the coming months, the latest Reuters poll showed, but there are signs of shaky confidence among currency strategists and economists.

4. South Korean tech giant Samsung Electronics Co Ltd estimated on Friday earnings grew at the slowest pace in more than a year in the second quarter, as analysts said weak smartphone sales likely offset record high chip earnings. The world's biggest maker of memory chips, smartphones and TVs said April-June operating profit would grow 5.2 percent to 14.8 trillion Korean won ($13.2 billion), just missing an average estimate of 14.9 trillion won from 18 analysts polled by Thomson Reuters.

5. Japan's government forecast on Friday the economy will grow faster than private-sector projections in fiscal 2019. The Cabinet Office's projections, presented at the Council on Economic and Fiscal Policy - the government's top economic panel, showed the economy was likely to grow 1.5 percent in price-adjusted real terms in the fiscal year starting in April 2019. It is expected to expand 2.8 percent in nominal terms.

Domestic News

6. China central bank governor Yi Gang said on Friday the country will turn to high-quality economic growth as its economy has entered a stage of "new normal". China has continued to deepen financial reform and opening-up and to implement prudent and neutral monetary policy, and used various measures to improve monetary policy framework, Yi said

7. Chinese Premier Li Keqiang said that no one will win by fighting a trade war, and will never initiates trade disputes. However, if the other side provokes a trade war by imposing additional tariffs, China will definitely take countermeasures, added the Chinese premier.

8. The trade war between China and the United States will have limited impact on the Chinese economy, several economists said. "The trade war involving 50 billion U.S. dollars will slow China's GDP growth by 0.2 percent with its impact on the economy, industry and enterprises already digested, and some impact has even been over interpreted," said central bank economist Ma Jun. Senior researcher of China Finance 40 Forum Ha Jiming said the trade war will drag down China’s economic growth by 0.1 percent.

9. The world's two biggest economies have fired the opening shots in a trade war that could open the Pandora’s Box, four sources said. China’s major ports have delayed the clearings of U.S. imports that may snap imports of some key products including soybeans and pork.

II. Market Overview
FX
1. Global Market

The dollar hit three-week lows on Friday after data showed the U.S. economy created more jobs than expected in June, but a closely watched inflation gauge - wage growth - rose less than forecast and the unemployment rate increased. As a result, expectations dimmed somewhat that the Federal Reserve would raise interest rates a fourth time this year. The greenback had weakened earlier on Friday as the United States and China imposed tariffs on each other's imports. In late trading, the dollar index was down 0.5 percent at 94.019. Against the yen, the dollar slid 0.2 percent to 110.42 yen, while the euro rose 0.5 percent to $1.1742

2. Home Market

The yuan fell below the mark of 6.66 per dollar in the morning session, following a weaker midpoint as the United States and China imposed tariffs on each other's imports and U.S. President threatened to expand tariff scope, traders said. Chinese regulators tried to soothe investors. But strong buying demand for forex is expected to weigh on yuan. Investors shall closely watch the response by U.S. and China following the trade war.

Precious Metals

Gold fell on Friday, but bounced off session lows as the dollar weakened and equities rose, yet bullion was on track for a small weekly gain amid escalating U.S.-Sino trade tensions. Spot gold was down 0.2 percent at $1,254.45 oz, off the session low of $1,252.15 and headed for its first weekly gain in four weeks. U.S. gold futures for August delivery settled down $3, or 0.2 percent, at $1,255.80 per ounce.

Commodities
Crude Oil

Oil was mixed on Friday as a Canadian supply outage supported U.S. crude prices, while an increase in production from OPEC's biggest exporter Saudi Arabia pushed Brent lower. U.S. crude futures gained 86 cents, or 1.2 percent, to settle at $73.80 a barrel. Global benchmark Brent slipped 28 cents to settle at $77.11 a barrel. For the week, WTI futures lost about 0.5 percent, while Brent lost about 3 percent.

Chinese bonds

Major cash bonds in China’s interbank bond market remained steady amid some profit-taking. Yields were little changed amid upbeat expectations. The trader war between world’s two largest economies was muted in the market as its impact had been digested.

Stock Market
1. U.S. Equities

U.S. stocks climbed on Friday, with the S&P 500 and the Nasdaq hitting their highest levels in two weeks, as strong U.S. jobs growth blunted the impact of an escalating U.S.-China trade dispute. The Dow Jones Industrial Average rose 99.74 points, or 0.41 percent, to 24,456.48, the S&P 500 gained 23.21 points, or 0.85 percent, to 2,759.82 and the Nasdaq Composite added 101.96 points, or 1.34 percent, to 7,688.39. All of the 11 major S&P 500 sectors posted gains. For the week, the Dow increased 0.7 percent, the S&P 500 rose 1.5 percent, and the Nasdaq gained 2.4 percent.

2.Hong Kong Equities

The Hang Seng index closed up 0.5 percent at 28,315.62

3. China Equities

China's stocks clawed back earlier losses to close in the positive territory on Friday. Pessimistic sentiment dragged the Shanghai Composite Index below the mark of 2,700 during the session, after Beijing and Washington started to impose tariffs on each other's imports. But bargain-hunting poured in around the noon bell, pushing the index sharply higher before paring some gains late in the session. Amid lackluster fundamentals, market is expected to fall back to decline after some technical rebound.