A bath of blood on Australian share markets with the rest of the region escaping most of the volatility today, following big falls on Wall Street overnight. Gold remains bid while the Australian dollar was largely unchanged after the latest unemployment print. Concerns over yield curve inversion continue with the Australian 10 year yield down another 6 pips today, closing in on the two year as the US Treasury market remains the bellweather for global recession concerns.
The Shanghai Composite has rebounded following a significant gap down at the open, currently only off by 0.4% or so to almost be back at 2800 points while the Hang Seng Index is almost unscathed as well, currently only down 0.1% to 25318 points. This puts it back near the recent daily lows from last week, but the daily chart is still spelling a lot of trouble ahead if it breaks below 25000 points proper:
Japanese share markets haven’t fared well following last nights bid on Yen, but have moderated going into the close with the Nikkei 225 clawing back its previous gains to close 1.3% lower at 20383 points. The USDJPY pair is remaining firm here after last night’s reversal, still just below the 106 handle as it hangs on:
The ASX200 was the worst – by far – off by nearly 3% in a single session, closing at 6408 points, but in perspective, only taking it back to the May lows. Remember Sell in May and go away? The Australian dollar has lifted on the back of the numberwang print, almost approaching the 68 handle but note the series of lower highs since last Friday – this is a weak instrument for sure:
S&P and Eurostoxx futures are up only 0.5% or so indicating more volatility ahead tonight as everyone watches the yield curve again. The S&P500 four hourly chart shows significant resistance now lower at the 2890 point level to clear to turn this dead cat bounce around – or is it nailed to the perch?
The economic calendar continues tonight with US recession signs possibly growing with the latest retail sales numbers under the spotlight.