Macro Morning

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By Chris Becker

A double whammy of economic releases overnight saw another retreat in risk markets as the USD soared against the majors, while gold went to a new four month low. While European Q1 GDP came in on target, German GDP underperformed alongside industrial production figures signalling some internal weakness in the EZ. In the US it was all about retail sales which grew as expected but interestingly, mortgage rates have spike to their highest in seven years as Treasury yields pip the 3% mark. Stocks were down in the US as a result and we should see a mixed to red day here in Asia.

Recapping stocks in Asia yesterday where the Shanghai Composite had a late afternoon attempt at breaching the next resistance level at 3200 points, lifting more than 0.5% to finish at 3192 points. Resistance at 3200 is still the obvious target in the short term but its a tough road to get back to the former highs, so I’m still watching daily momentum to move into the positive zone before considering a new long position:

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