by Chris Becker
Outside Japan, its much ado about nothing for stock markets in Asia, as a positive lead overnight has not turned into anything substantive on Chinese or Australian bourses. The return of a stronger USD has been temporary so far, with gold coming back a little alongside Aussie dollar, while the Yen remains sold off for now.
The Shanghai Composite is flat as a tack just before its lunch break at 3111 points, still unable to build on recent intervention which bought at the key support level at 3100 points. The Hang Seng is down 0.6% unable to hold onto its recent gains in a reversion to mean trade here – which needs to get above previous resistance at 23000 points to stick:
Stocks are positive in Japan with the Nikkei up nearly 0.8% and back above 19000 points, all due to the slump in Yen overnight as USD grew stronger on Janet Yellen’s comments. The USDJPY pair zoomed up to the 115 handle back has come back in the afternoon, currently at 114.50 or so. This is clearly overdone, so a pullback is to be expected, I’m watching the low moving average at 114.25 to hold here:
S&P Futures are still stuck going nowhere, as I said this morning the support here remains strong but there’s a lack of confidence – a see who blinks first nature – with this market:
The ASX200 is having another so-so day, surging on the opening but going nowhere coming into the close, currently up only 0.1% with banks down, commodity players – except gold miner Newcrest – up to balance it all out. Again, lack of confidence here too.
The Aussie dollar fell on the Sydney open after it was cut down overnight but has recovered to be slightly above 75 cents against USD going into the London open. This has not yet signalled a swing play on the upside with this area providing a local zone of resistance:
The data calendar tonight will focus squarely on the ECB monthly meeting, with no change expected, so expect the unexpected. There’s also a slew of second tier US housing and other data, but I think all eyes are on the upcoming inauguration….