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It was a pretty subdued day for Asian session trading, as Japan, Taiwan, and South Korea greeted the week with holidays.

  • Japan’s markets out on Health-Sports Day holiday
  • China’s Caixin services PMI slips from 52.7 to 50.6 in September

Major Events/Reports:

China’s Caixin services PMI miss

China started its post-holiday trading on a weak note after Caixin reported weaker-than-expected services PMI for September.

The seasonally adjusted services index clocked in at 50.6 in September, which marks the lowest in 21 MONTHS for the report. What’s more, growth in manufacturing production also slipped to its 3-month low!

Apparently, slower growth in new orders got mixed in with weaker increases in activity. Service providers also reported slower rate of staff hiring even though hiring in the sector still mostly offset job losses from the manufacturing industry.

Overall, the composite numbers point to manufacturers and service providers expressing weaker degree of optimism due to slower output and new business demand.

For newbies out there, you should know that Caixin’s PMIs concentrate on the small players and not the large businesses that the official readings focus on.

North Korea concerns

China may be back from its week-long holiday, but this didn’t fire up the charts significantly since Japan, Taiwan, and South Korea’s markets are out celebrating their own holidays.

Of course, it also didn’t help that traders remain wary of a possible nuclear attack from North Korea. Last Friday a Russian lawmaker who visited Pyongyang shared that the hermit kingdom is preparing to test a long-range missile which could very well reach the west coast of the U.S.

Despite these, the Asian bourses remained chill:

  • Australia’s A SX 200 is up by 0.57% to 5,743.40;
  • Hang Seng is down by 0.31% to 28,369.00; and
  • China’s A50 is up by 2.22% to 12,228.19.

Even commodities saw a bit of start-of-week boost:

  • Gold prices rocketed by 0.84% to $1,285.65;
  • Silver rose by 1.02% to $16.96
  • Brent crude oil is up by 0.29% to $55.78, and
  • U.S. crude oil prices is up by 0.39% to $49.48.

Major Market Mover(s):

NZD

The high-yielding comdoll got clobbered by threats of North Korean missile attacks, China’s weaker-than-expected PMI, and a lack of trading volume, as well as news over the weekend that the final tally for New Zealand’s election will allow a coalition between Labour and the Greens to mount an effective challenge against National. Also, New Zealand First gets to be the “kingmaker” since its has the seats needed to push either National or a Labour-Greens coalition into power.

NZD/USD gapped down from .7084 to .7062 before closing at .7071;
NZD/JPY gapped from 79.81 to 79.53 before capping the session at 79.65;
AUD/NZD gapped up from 1.0965 to 1.1004 before closing at 1.985, and
GBP/NZD opened at 1.8514 (from 1.8438) to close at 1.8523.

Watch Out For:

  • 6:00 am GMT: Germany’s industrial production (0.8% expected, -0.1% previous)
  • 6:30 am GMT: France’s BoF business sentiment (105.0 expected, 104.0 previous)
  • 8:30 am GMT: Euro Zone Sentix investor confidence (28.0 expected, 28.2 previous)