A pause in risk taking here in Asia today, with almost all stock markets retracing or treading water. The USD sunk to a new three year low against the majors, particularly Yen as markets react to the strange Trump protectionism and globalism policies, with more likely tonight at Davos. The ECB is meeting as well, so that should shake up currencies while commodities continue their advance under the weaker USD.
In mainland China the Shanghai Composite is pausing here after making great inroads previously, closing only a few point or 0.1% higher to 3563 points. The Hang Seng Index has decided to call it a day as well, down a few points o just over 0.1% to just finish below the 33,000 point level in a welcome consolidation in this too-perfect uptrend:
S&P futures are very flat following the weird session overnight, stabilising at the 2839 point level. . BTFD still rules until it doesn’t, so watch out for Trump’s remarks at Davos tonight;
Japanese stocks have retraced as expected from the overnight strengthening in Yen, with the Nikkei 225 down another 1% to 23685 points. The USDJPY pair is dicing with the 109 handle now with barely any upside support, so 108 looks set to be the next target:
The ASX200 was also timid, with is to be expected given the lack of trading tomorrow for “I still don’t know if Im a sovereign nation” Day tomorrow. It finished 0.1% lower at 6050 points.
The Aussie dollar had a sneak peek above the 81 cent level vs USD and could follow through later tonight, as all eyes turn towards the ECB:
The economic calendar will focus squarely on the ECB rate meeting tonight, followed by a slew of secondary releases in the US, including initial jobless claims, home sales and retail inventories.