Macro Morning

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By Chris Becker 

Sentiment seemed to improve overnight with a bounceback in risk assets, with Wall Street closing about 1% higher although the USD firmed across the board. Treasury yields lifted slightly, but the chance of the Federal Reserve rate cut by the end of the year rose as well, now a near certainty as the economic outlook weakened. The German ZEW Survey saw a lift in current conditions, but the outlook dropped due to the ongoing US/China trade war, with Europe stuck in the middle.

Yesterday the Shanghai Composite closed below 2900 points again, down 0.7% to 2883 points, still in a wide corrective move. In Hong Kong, the Hang Seng Index reopened down 1.5% to just above 28000 points and is the worst performer in the region. Note how fast support evaporated once 29000 points was cleared, although futures are suggesting a possible bounceback today, its catching falling knives territory still:

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