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Markets Update: APAC stocks lower as investors digest Chinese trade data - CN exports and imports down again m/m; AU leads Asian equities down; Huawei trumpets new phone with 7nm chip;
Economic Calendar
Global Markets Roundup: 07 Sep 2023
Asian stocks were pressured on Thursday as the region took its cue from the losses stateside, while participants also digested the latest Chinese trade data.
The Chinese trade data showed a continued contraction in the nation's exports and imports, but was not as bad as feared. However, the data did little to boost sentiment, as investors remained concerned about the global economic outlook.
The Nikkei 225 was down 1.2%, the Hang Seng was down 1.0%, and the Shanghai Composite was down 0.7%. European equity futures were indicative of a lower open, with the Euro Stoxx 50 future down 0.3%. The US dollar index held on to yesterday's data-driven gains, with the euro and the Japanese yen trading at 1.07 and 147, respectively.
ASX 200 falls as commodity stocks underperform
The Australian stock market fell on Thursday, dragged lower by weakness in the commodity-related sectors. The ASX 200 closed down 0.7%, with the energy and materials sectors leading the losses.
The Nikkei 225 swung between gains and losses, but eventually succumbed to the selling pressure. The index closed down 0.2%, with the technology sector being the biggest drag. The Hang Seng and Shanghai Composite also fell, in line with the downbeat mood in global markets.
The Hang Seng closed down 0.6%, and the Shanghai Composite closed down 0.4%. Tech stocks were pressured by frictions between the US and China. The FCC chair asked US government agencies to address the threat posed by Chinese cellular connectivity modules, and a lawmaker called for an investigation into SMIC for potentially violating US sanctions by supplying components to Huawei. Furthermore, China reportedly banned government officials from using iPhones at work and was said to be seeking to extend this to state firms and agencies.
FX markets: US dollar holds on to gains amid subdued risk appetite
The US dollar held on to its gains on Thursday, as investors remained cautious amid the ongoing tensions between the US and China. The dollar index was up 0.1%, trading at 107.20.
The euro was flat against the dollar, trading at 1.07. The pound was also flat, trading at 1.25. The Japanese yen weakened slightly against the dollar, trading at 147.
The Australian dollar and New Zealand dollar were both subdued, as investors digested the latest Chinese trade data. The Australian dollar was down 0.1%, trading at 0.68. The New Zealand dollar was also down 0.1%, trading at 0.62.
Fixed income markets: US Treasuries consolidate after hawkish reaction to ISM Services data US Treasury yields consolidated on Wednesday after the hawkish reaction to the US ISM Services data. The yield on the 10-year Treasury note was down 0.1 basis points, to 3.26%. The ISM Services data showed that the services sector grew at a faster pace in August than in July. This data was seen as a sign that the US economy is still growing, but it also raised concerns about inflation. The Federal Reserve is expected to raise interest rates later this year in an effort to combat inflation. The ISM Services data could make the Fed more likely to raise rates by 50 basis points at its next meeting.
Commodities: Crude oil prices lower but supported by bullish inventory data
Crude oil prices were slightly lower on Thursday, but they were supported by bullish inventory data. US crude oil inventories fell by 5.5 million barrels last week, more than expected. This data suggests that demand for oil is still strong.
Saudi Arabia raised its official selling prices to Asia for October. This is seen as a sign that the Saudis are confident in the demand for oil.
The price of gold was contained within tight parameters alongside a rangebound dollar. The price of copper was lacklustre due to the subdued mood and continued contraction in China's trade data.
Looking ahead, key economic data releases include German Industrial Production, UK House Prices, EZ Employment Final, US IJC, G20 Finance & Energy Meeting, BoE's Monthly Decision Maker Panel, ECB’s Elderson, Fed’s Goolsbee, Bowman, Logan, Harker, Williams & Bostic, Supply from Spain, France & US.
General news - Information source from multiple newswires.
The article and the data is for general information use only, not advice!
The Trade Academy Team
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