The bounce is on as equity markets in Asia catch up to the relief rally from Wall Street on Friday night, with the bond market selling off slightly, temporarily staving off concerns over yield curve inversions. This all seems to be on a flimsy promise of more talks between China and the US on trade, and not much else, so don’t get too excited!
Chinese stocks are doing the best, with the Shanghai Composite rebounding to be up nearly 2% at 2873 points while the Hang Seng Index is doing even better, up 2.2% to finish at 26297 points. This is a great result, sending the bourse up to a new high and above the high moving average but not quite above the previous bounce point:
Japanese share markets are doing well as Yen stays steady with the Nikkei 225 advancing nearly 0.8% to finish at 20536 points. The USDJPY pair is firming once more here after remaining in a tight band on Friday night, with the potential to breakout above the 106.40 level as volatility reduces to pre-breakout levels:
The ASX200 is starting the week with a bang, up 1% even to close at 6467 points, with bank and oil stocks leading the way. The Australian dollar is flat however with no catalysts to get it moving, still stuck in a tight band just below the 68 handle as it still signals weakness ahead:
S&P and Eurostoxx futures are firming nicely, up 0.5% or so indicating more upside ahead tonight as everyone hopes this dead cat comes back alive. The S&P500 four hourly chart shows price heading back up to significant resistance at the 2930 point level but can this be sustained:
The economic calendar starts the week slowly with some Treasury auctions and final CPI figures in Europe.