The outright optimism from a finalisation of a trade deal between US and China yesterday has been switched to that of caution with most stock markets putting in scratch sessions in response to the stall on Wall Street overnight. The Kiwi is dropping on an unexpected rise in New Zealand unemployment rate while the Aussie dollar is just holding above 69 cents as commodities remain strongly bid.
In mainland China, after cracking through the 3000 point level previously, the Shanghai Composite is in retracement mode going into the close, down 0.4% to 2980 points and unable to gain any traction. Meanwhile the Hang Seng Index is putting in a scratch session, currently up only 0.1% to 27719 points after recently clearing the 27000 point level and the weekly downtrend line last week:
Japanese share markets have also abated somewhat following the big surge yesterday with the Nikkei 225 closing only 0.2% higher at 23297 points. This was despite a huge leap in the USDJPY pair overnight, but during the Asian session Yen buyers have stepped in to pull back to just above the 109 handle:
The ASX200 is the worst in the region, falling a solid 0.5% in the risk off mood to be at 6660 points, despite a lower Aussie dollar overnight. The Pacific Peso fell back below the 69 handle and is struggling here just above weekly support at the 68.75 level:
Both S&P and Eurostoxx futures are down slightly with the S&P500 four hourly chart showing a retracement below a firming bearish rising wedge pattern with the terminus just above ATR support at 3050 points which bears (sic) watching:
The economic calendar tonight is very Euro-centric, with factory orders and services PMIs dominating while in the US there’s some more Fed speeches to keep an ear out for.