Market News & Analysis
Market Brief: Looking Vulnerable For Another Round Of Risk Off
Kelvin Wong October 9, 2019 1:47 PM
- Key Asian stock markets have almost given up the gains accumulated since the start of the week; taking the cue from the sell-off seen in U.S. stocks overnight. Right now, the U.S. administration has upped its hawkish stance towards China where visa bans have been imposed on Chinese officials linked to violation of human rights over Muslims in the Xinjiang region on top of the recent blacklist of eight Chinese technology firms over similar human rights violation.
- The mood has turn sombre for a positive break through on the upcoming two days of high-level U.S-China trade negotiation talks in Washington that will kickstart on Thurs, 10 Oct. Also, SCMP have reported that the highest ranking official from the Chinese delegation, Vice Premier Lui He will not carry the title of “special envoy” for the upcoming trade talks, an early indication that Lui He has received no particular instructions from China President Xi and a source has told SCMP that the Chinese delegation may cut short its stay in Washington.
- Hong Kong’s Hang Seng Index has continued to slide where it recorded a slide of -0.71% as at today’s Asia mid-session towards its 10-day low of 25600. Financials, properties and technology related stocks are the worst performers where Hang Seng Bank, AAC Technologies and CK Asset Holdings have declined by -3.39%, 3.26% and -2.20 % respectively.
- South Korea’s Kospi 200 is closed today for a public holiday. The S&P 500 E-mini futures has managed to shape a bounce of 0.20% to print a current intraday high of 2903 in today’s Asian session after a decline of -1.56% seen in the U.S. session. However, the current bounce does not look like a potential bullish reversal from a technical analysis perspective.
- After a sell-off in the GBP seen yesterday (the weakest currency in the overnight U.S. session) reinforced by the dim prospect of getting EU approval on U.K PM Boris Johnson’s latest Brexit proposal, the GBPUSD has traded in a tight range of 13 pips in today’s Asian session.
- The antipodean currencies are the best performers so far where the NZD/JPY AUD/JPY, NZD/USD and AUD/USD have recorded modest gains between 0.15% to 0.28% but these gains are questionable in the backdrop of an escalation in political tension between U.S and China where it may derail any positive outcome on the upcoming high-level U.S-China trade talk.
- Fed Chair’s Powell speech (the third & last for this week) and FOMC minutes on the Sep meeting. In yesterday’s speech at the National Association for Business Economics Annual Meeting, Fed Chair Powell has indicated that Fed will start to grow its balance sheet soon to counter the recent turmoil seen in the repo market and open the door for another interest rate cut in the upcoming Oct FOMC meeting.
Data from Refinitiv. Index names may not reflect tradable instruments and not all markets are available in all regions.
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.