- RBA cut rates to a new record low and retained a dovish bias in their statement.
USD remained king in Asia with the US dollar index hitting its highest level since May 2017.
- Manufacturing PMI data across Asia saw further deterioration for the sector, with South Korean PMI contracting for a fifth consecutive month and the broader ASEAN read for a fourth. Japan’s PMI finished at a 7-month low, with output and new orders mostly weighing on the headline read.
- Australian building approvals contracted for a third month at -1.1%, missing the consensus view of +2.5%. Private house approvals also declined -2.4%. Separately, Moody’s expect mortgage delinquencies in Australia to continue to rise.
- Bitcoin rallied to a 6-day high following yesterday’s bullish outside candle.
- All key Asian stock markets are showing positive gains today after close to a week of losing streak. The China and Hong Kong stock exchanges are closed today for China’s National Day. Hong Kong will resume trading tomorrow while China stock exchanges will be shut till next Mon, 07 Oct.
- Positive trade flow news is the primary catalyst for the current optimism that downplayed U.S. President Trump’s impeachment troubles. The most hawkish official in the U.S. administration; Peter Navarro, the White House trade advisor has dismissed reports that U.S. is considering delisting Chinese companies from U.S. stock exchanges as “fake news”.
- The current outperformer as at today’s Asian mid-session is the Singapore’s STI which has rallied by close to 1.00%, its best performance seen so far in the past 5 days. Heavy weightage index component banking and high-tech manufacturing related stocks are leading the gain where DBS Group and Venture Corp have advance by 1.36% and 3.98% respectively on the backdrop a positive flash estimate from Singapore’s Urban Redevelopment Authority that has shown overall prices of private homes rose 0.9% q/q in Q3. Also, the positive performance of key U.S. technology stocks seen overnight in the U.S. session where Apple has staged a rally of 2.35% to print a 5-day high.
- The Australia’s ASX 200 has also joined the bullish party wagon in the later part of today’s session as it rallied by 0.66%. RBA has cut its key policy interest rate to a record low of 0.75% as expected. In addition, its monetary policy statement has also hinted more cuts could be on the way due to sluggish wage growth that has dragged down domestic consumption.
- Preliminary Eurozone Core Consumer Price Index for Sep where consensus is pegged at 1.0% y/y over 0.9% y/y seen in Aug. A weaker print may see further downside pressure in the EUR as ECB is likely to intensify its QE programme.
- RBA’s Governor Lowe’s speech where further dovish remarks may reinforce further downside in the AUD.
- Manufacturing PMI remains the key economic data set for traders as the month gets underway. In September, the ISM manufacturing print contracted (below 50) for the first time in three years. And the sub-indices had little to be desired as well. Analysts are expecting it to cross back above 50 (albeit slightly) but could be taken as a sign that last month was just a blip, if it can indeed expand. Whereas a print below 49.1 could be taken as confirmation that things are not all well with the economy and provide a risk-off theme to the session.
This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.
GAIN Capital Singapore Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the GAIN Capital group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), GAIN Capital Singapore Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact GAIN Capital Singapore Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.
In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither GAIN Capital Singapore Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.
GAIN Capital Singapore Pte. Ltd. is not under any obligation to update this report.
Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.
Cryptocurrencies are not legal tender currency and trading of derivatives on Cryptocurrencies are currently not covered under any regulatory regime in Singapore. Consequently, investors should be aware they do not have protection under the Securities and Futures Act (Cap. 289). Please ensure that you are fully aware of the risks.