Trump is causing a ruckus on risk markets across Asia today with just two tweets – someone take that phone off that madman! Chinese stocks collapsed as the potential for a stall or even abandonment in US/China trade talks firms while currency markets were all over the place as risk sentiment inverted completely.
The Shanghai Composite reopened and is currently down over 6%! Going into the close its at 2882 points, losing almost 200 points while in Hong Kong the Hang Seng Index is down nearly 1000 points or 3%, currently at 29160 points, wiping out all of the last two months gains and well below previous local support at the 29000 point level:
Confidence has also disappeared on US and Eurostoxx futures which are down significantly, with the four hourly chart of the S&P 500 looking showing the 1.5% plus gap this morning following the Trump tweets on China, well below support at the previous terminal resistance level at 2900 points:
Japanese share markets were closed for their final day of The Golden Week holiday, while trading in the USDJPY pair was volatile to say the least, with a 100 pip gap down on the open and then nearly half filled to remain just below the 111 handle. This is a clear risk off indicator and is likely to be even more volatile on the return of Japanese traders tomorrow:
Australian stocks are the best performers but that’s not saying much, the ASX200 down 0.8% to 6282 points. The Australian dollar gapped down to the mid 69’s before recovering slightly in line with other undollar assets, but is still just below the 70 handle going into the European open as traders position for tomorrows RBA meeting:
The economic calendar starts the week off slowly with some EZ retail sales and final PMI prints but not much else. All eyes on the Twit-in-Chief!