by Chris Becker
Asian markets have had mixed reactions to the long winded and empty speech by Trump to the US Congress with the main benefactors the USD and Japanese stocks, as caution over the potential for wild statements was abated. The address came after some big economic releases with Australian GDP surprising on the upside and Chinese manufacturing PMI also still positive.
The Shanghai Composite has reacted positively to the PMI print, up nearly 0.4% to 3252 points. The Hang Seng Index is flat again, up a couple points to remain well below the 24000 points level. The daily chart is still suggesting what looks like a top here as price hovers around the low daily moving average and below the daily trendline:
Japanese stocks are doing much better as expected as Yen weakened appreciably against the USD on Trump’s speech. The Nikkei closed up 1.5% higher to finish at 19,400 points. The hourly chart for USDJPY shows the big move higher as a small selloff last night was quickly reversed on the Sydney open as the 113.50 level comes under threat. Let’s see if it holds through tonights session and the ISM print:
S&P futures are steady with no adverse reaction to the speech:
The ASX200 had yet another dour session, absorbing the GDP print and volatile trade in the dollar, closing down 0.1% or 7 points to be at 5704 points, still well below the 5800 point resistance zone.
The Aussie dollar slumped immediately on the Sydney open, but then reversed course as the GDP print came through with some excellent opportunities for intraday traders getting right up to but not through the 77 handle against USD. It then reversed on Trumps speech and is hovering at the 76.50 level unsure of where its going, but the bullish bets are starting to unwind in the face of bigger macro pictures:
The data calendar continues tonight with the two most important European economic prints – German unemployment and inflation while in the US its the ISM manufacturing print.