By Chris Becker
Risk markets tumbled and the USD soared as data from the US suggested GDP growth is going to be softer than expected. Fourth quarter GDP is now estimated to be 1%, according to the Atlanta Fed after the Markit services PMI came in barely above expansion. Gold shattered below $1500USD, with all the undollars following in kind, but USDJPY leapt to a new weekly high as Wall Street stumbles around with scratch sessions going into the close.
Looking at the action on Asian markets yesterday, where the Shanghai Composite finally cracked the 3000 point level before retreating just before the close, finishing 0.5% higher to 2991 points. In Hong Kong, the Hang Seng Index did about the same, up 0.5% to 27683 points going into the close. Having cleared the 27000 point level and the weekly downtrend line last week, it should be sailing here but given how strong this move has been and the stumble in risk overnight, that overbought momentum reading maybe signalling downside instead:
