ASX futures were 8 points or 0.10% higher as of 8:00am on Friday, indicating a slight gain at the open. US stocks declined again today as economic data and corporate earnings reports clouded investors' view of the health of the economy. The S&P 500 slipped 0.76%, putting the index on course for a third consecutive day of declines. The Dow Jones Industrial Average also lost 0.76% -- dropping into negative territory for the year -- while the technology-heavy Nasdaq Composite shed 0.96%. Markets began 2023 with strong gains, buoyed by optimism that the Fed may soon begin slowing the pace of its interest rate rises. The end of China's severe pandemic restrictions also encouraged some investors. But in recent days that upbeat mood has started to fade, with investors concerned that the lagged effects of the Fed's rate rises are beginning to take their toll. Losses this week have come alongside weaker-than-expected economic figures, which sent indices lower Wednesday, including a 1.6% drop for the broad S&P 500. Data on retail sales and producer prices both pointed to growing sluggishness in the US economy, a sign that the Federal Reserve's fight against inflation is working, but not without an economic cost. Weekly data released on Thursday showed jobless claims falling to the lowest level since September, suggesting the labor market remains tight. But a batch of lukewarm corporate earnings releases and the Fed's latest look at the business climate have added to traders' concerns. In commodity markets, Brent crude oil climbed 1.66% to $US86.39 a barrel and gold added 1.43% to US$1,931.40. In local bond markets, the yield on Australian 2 Year government bonds slid to 2.88% while the 10 Year dropped to 3.32%. In the US, the yield on 2 Year Treasury notes decreased to 4.11% and the yield on 10 Year Treasury notes dipped to 3.40%. The Australian dollar decreased to 69.19 US cents after its previous close of 69.39. The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies, edged lower to 95.12.

Asia

Chinese shares ended higher, reversing early losses, as more capital flowed into the market on expectations that the economy will pick up in 2023. Market sentiment was also boosted by the meeting between US Treasury Secretary Janet Yellen and Chinese Vice-Premier Liu He, which could help mitigate tensions between the two countries. Software companies and securities stocks led gainers. iFlytek rose 9.1% and China International Capital Corp. gained 1.2%. Retailers and food producers weighed on the market. Index heavyweight Kweichow Moutai fell 0.7% and Yonghui Superstores dropped 0.3%. The Shanghai Composite Index gained 0.5% to 3240.28, the Shenzhen Composite Index rose 0.7% and the ChiNext Price Index was 1.1% higher. Hong Kong's benchmark Hang Seng Index closed 0.1% lower at 21650.98, tracking Wall Street losses overnight as weak US economic data renewed recession concerns. Most stocks on the HSI were lower, with retailers and tech companies underperforming the market. NetEase dropped 3.0% after Wednesday's 6.5% rebound amid its licensing dispute with US gaming company Activision Blizzard. Baidu and Xiaomi fell 2.7% each, leading the Hang Seng Tech Index 1.7% lower. Property stocks were among the gainers. The Hang Seng Mainland Properties Index rose 3.2%, with Country Garden advancing 4.9% and Longfor Group gaining 3.5%. Japanese stocks ended lower, dragged by declines in auto and electronics shares, as uncertainty persisted over the global economic outlook and following Wednesday's sharp stock gains. Nissan Motor dropped 3.6% and Lasertec lost 2.8%. The Nikkei Stock Average fell 1.4% to 26405.23 after a 2.5% rise Wednesday. India's benchmark Sensex index closed 0.3% lower at 60858.43 amid negative global cues and fears of an impending recession, ICICI Direct Research analysts said in a note. Earnings may remain in focus, with various Indian companies scheduled to report results. Decliners included Asian Paints, 2.6% lower, IndusInd Bank, down 1.9%, and Tata Motors, off 1.9%. Among the gainers were Tata Steel, which added 0.7%.

Europe

European stocks dropped as Wall Street retreated amid mixed economic data. The pan-European Stoxx Europe 600 fell 1.48% while Germany’s DAX shed 1.72% and France’s CAC 40 slid 1.86%. "Having seen the biggest one-day decline this year in Wednesday's trading, US markets have continued the softer theme today, opening lower even as weekly jobless claims fell to their lowest level since September of last year at 190k," CMC Markets analyst Michael Hewson wrote. "Building permits and housing starts for December both declined, falling 1.6% and 1.4% respectively." The British FTSE 100 closed 1.07% lower on Thursday following weakness in the US, UK's chief market analyst for CMC Markets Michael Hewson said in a note. "Today's biggest fallers have included house builders after the latest RICS house price balance survey fell further into negative territory from -26% in November to -42% in December. All regions across England are showing falls in prices, weighing on the likes of Persimmon, Taylor Wimpey and Berkeley Group," he said. Persimmon ended 5.6% down, Taylor Wimpey finished 3.9% in the red and Berkeley Group closed 4.0% lower.

North America

US stocks declined again today as economic data and corporate earnings reports clouded investors' view of the health of the economy. The S&P 500 slipped 0.76%, putting the index on course for a third consecutive day of declines. The Dow Jones Industrial Average also lost 0.76% -- dropping into negative territory for the year -- while the technology-heavy Nasdaq Composite shed 0.96%. Markets began 2023 with strong gains, buoyed by optimism that the Fed may soon begin slowing the pace of its interest rate rises. The end of China's severe pandemic restrictions also encouraged some investors. But in recent days that upbeat mood has started to fade, with investors concerned that the lagged effects of the Fed's rate rises are beginning to take their toll. Losses this week have come alongside weaker-than-expected economic figures, which sent indices lower Wednesday, including a 1.6% drop for the broad S&P 500. Data on retail sales and producer prices both pointed to growing sluggishness in the US economy, a sign that the Federal Reserve's fight against inflation is working, but not without an economic cost. Weekly data released on Thursday showed jobless claims falling to the lowest level since September, suggesting the labor market remains tight. But a batch of lukewarm corporate earnings releases and the Fed's latest look at the business climate have added to traders' concerns. "The housing market is clearly in a recession; the manufacturing sector is teetering on the edge of a recession. We are going into 2023 with a more cautious consumer, and as the year progresses we will see some signs that the job market is faltering," said David Donabedian, chief investment officer at CIBC Private Wealth US. On Thursday, tepid earnings reports drove some of the biggest declines in individual stocks. Aluminum producer Alcoa fell 3.9% after it reported a slump in revenue due to lower aluminum prices. Credit card issuer Discover Financial lost 2.3% after the company reported that more of its customers are falling behind on loan and credit card payments. Procter & Gamble stock rose slightly. The consumer goods giant reported lower quarterly profit and declining sales volumes as the rising costs of Tide detergent and other staples prompted consumers to cut back on purchases at the end of 2022. Stocks in Toronto also closed lower today. Most sectors lost, with producer manufacturing, process industries, and technology dragging the most. Only the materials, health services, and industrial services sectors were posting gains. Montreal-based Sunshine Biopharma Inc.'s shares were down after the company said that it would buy back up to $2 million worth of its common shares. Canada's S&P/TSX Composite Index was 0.19% or 37.87 points lower.