Global trade-related news didn’t go away for most of the Asian session market players, but they were set aside long enough for the bulls to get some intraday momentum.
- AU NAB business confidence slips from 7 to 4 in August
- Japan’s tertiary industry activity up by 0.1% as expected vs. 0.6% decline in July
- Japan’s preliminary machine tool orders (y/y) jumps by 5.3% vs. 13.1% increase in July
- Foreign Minister Geng Shuang: China to “inevitably take countermeasures” if U.S. goes ahead with new tariff measures
There were no bombshell economic release in the past couple of hours, so trade-related news remained under the spotlight for market geeks.
Traders are still watching Canada’s next round of NAFTA negotiations with the U.S., which had been going on for at least a year now.
Word around the hood is that Canadian reps are operating under the assumption that they have until the end of the month to get a deal with one of Canada’s biggest trading partners.
Meanwhile, China’s Foreign Minister Geng Shuang warned that the world’s second-largest economy is ready and willing to strike back in case the U.S. fires another round of tariff increases. In a presser, he shared that:
“If the U.S. side obstinately clings to its course and takes any new tariff measures against China, then the Chinese side will inevitably take countermeasures to resolutely protect our legitimate rights…”
Overall risk appetite
Whether it’s a lack of fresh volatility-inducing headlines or a bit of profit-taking from the previous days’ losses, Asian session market players found enough courage to take on some risk today.
- Nikkei is up by 1.24% to 22,651.3
- A SX 200 is up by 0.53% to 6,181.1
- Shanghai index is up by 0.30% to 2,677.537
- Hang Seng is down by 0.02% to 26,606.9
Commodity prices were a little more mixed, with gold slipping on the back of dollar demand while crude oil prices rode the risk appetite train.
- Gold is down by 0.15% to $1,193.80 per troy ounce
- Brent crude oil is up by 0.25% to $77.48 per barrel
- U.S. WTI is up by 0.12% to $67.58 per barrel
Major Market Mover(s):
Asian session traders caught up to their London and U.S. counterparts and priced in the upbeat headlines regarding Britain’s EU exit.
GBP/USD is up by 14 pips (+0.11%) to 1.3039; EUR/GBP is down by 4 pips (-0.04%) to .8894, and GBP/NZD is up by 13 pips (+0.06%) to 1.9972.
News of Japanese chipmaker Renesas acquiring its U.S. counterpart Integrated Device Technology Inc. for $6.7 billion brought the bears to the yen’s yard today. Of course, it didn’t help the safe haven that market players were in the mood to take on some risk.
USD/JPY is up by 33 pips (+0.30%) to 111.43; EUR/JPY is up by 45 pips (+0.35%) to 128.25; GBP/JPY is up by 58 pips (+0.40%) to 145.30; CHF/JPY is up by 34 pips (+0.30%) to 113.29; AUD/JPY is up by 31 pips (+0.39%) to 79.34, and NZD/JPY is up by 26 pips (+0.36%) to 72.75.
There were no direct catalysts for the franc’s losses though an overall risk-friendly trading environment might have dragged on the low-yielding currency.
EUR/CHF is up by 8 pips (+0.07%) to 1.1308; GBP/CHF is up by 16 pips (+0.12%) to 1.2713, and AUD/CHF is up by 7 pips (+0.09%) to .6942.
Watch Out For:
- 8:30 am GMT: U.K.’s claimant count change (6.9K expected, 6.2K previous)
- 8:30 am GMT: U.K.’s unemployment rate expected to remain at 4.0%
- 8:30 am GMT: U.K.’s average earnings index seen at 2.4% for another month in August
- 9:00 am GMT: Germany’s ZEW economic sentiment (-13.5 expected, -13.7 previous)
- 9:00 am GMT: Euro Zone’s employment change (q/q) to remain at 0.4%?
- 9:00 am GMT: Euro Zone ZEW economic sentiment (-10.9 expected, -11.1 previous)
- 10:00 am GMT: U.S. NFIB small business index (108.1 expected, 107.9 previous)