by Chris Becker
Buyers everywhere in Asia – except Shanghai maybe – as this half of the world follows the other half in a frenzy to bid stocks higher ahead of tonights ECB meeting and next week’s Fed version. Financials were the main recipients while major currencies clawed back previous losses against USD with hot money also finding its way into sovereign bonds as Australian 10 year yields fell over 7 points. Its looking like another solid session tonight as a multi-trillion dollar rally post US presidential election is indeed looking huuuuge.
The Shanghai Composite is the stand out, stagnant after its long lunch break, down a few points and going nowhere. It’s currently at 3218 points where hopes are being dashed it can hold on to its own bear market rally. The Hang Seng is up 0.5% as it tries to build on its previous bounce with the daily chart still showing a level of resistance around the 23000 point level, with momentum switching to positive today:
In Japan, both the Nikkei and Topix share markets are up more than one percent even as the Yen firms against USD. The USDJPY pair has fallen below its trend line and down to 113.35 where its finding a base here before the London open. This looks quite bullish for Yen, having been unable to make a new daily high for sometime presaging these falls:
S&P Futures continue to drift higher where we should see another positive session on Wall Street and in London later tonight, all save for any ECB disappointments:
The ASX200 zoomed higher on the back of banks and insurance giants, up over 1.2% to 5543 points. This takes it almost back to the early August highs, setting up for a big rally going into Christmas:
The Aussie dollar really wants to breach the 75 handle against USD but is falling short, although it rallied earlier in the session. I think tonight will see it bust through if the risk proxy correlation stays the course – and then its daylight to 80 cents:
The data calendar tonight will focus squarely on the ECB meeting where expectations are high for more asset purchases, while in the States we get initial jobless claims and not much else.