Asian equities are subdued as investors are awaiting US payrolls for more indications of rate reductions

After a sluggish start to the year, most Asian equities stabilised on Friday, as investors remained on edge due to expectations for important U.S. payrolls data and ongoing worries about China.

Following Wall Street's losses during the first three trading days of 2024, the majority of regional markets were expected to conclude lower for the week. A combination of profit-taking and mounting scepticism over the Fed's early interest rate reduction contributed to the new year's losses.

Asian markets were also affected by worries about China after the ratings agency Fitch downgraded the four largest state-backed asset managers in the nation on Thursday.

Up to the first week of the new year, Chinese equities had the poorest performance among all Asian stock markets.

Wider Asian markets saw tight range trading and weekly losses due to a combination of profit-taking and Fed anxiety.

This week, Japan's Nikkei 225 index had a 0.1% decline and a 0.4% rise as the nation's morale was affected by a terrible earthquake.

The ASX 200 index for Australia gained less than 0.1% and was expected to lose 1.2% this week as it deviated from its peak since the middle of 2021.

The KOSPI in South Korea dropped 0.1% and was expected to lose 2.7% this week due to declines in large-cap technology firms.

With the critical U.S. nonfarm payrolls data for December arriving later in the day, the markets were now fully focused.

More labour market cooling is anticipated in the reading, but it's uncertain if this cooling will be significant enough to persuade the Fed to lower interest rates sooner rather than later.