Some liquidity returned to stock markets overnight as the new trading year got underway, but its still tentative at best with Wall Street continuing its bear market phase with a mild selloff. European shares did slightly better as the latest German inflation print came in much softer than expected, with an easing in Euro and Pound Sterling both helping confidence. Yen however remains strong against USD while the Australian dollar consolidated its falls post the Chinese PMI print from yesterday. US Treasury yields eased off against with the 10 year issue falling back to the 3.5% level while the commodity complex saw oil prices slump as Brent crude retraced to just above the $82USD per barrel level as gold roared again to close well above the $1800USD per ounce level this morning.
Looking at share markets in Asia from yesterday’s session where mainland Chinese share markets accelerating into the close with the Shanghai Composite lifting nearly 1% to get back above the 3100 point level, closing at 3116 points while the Hang Seng Index has bounced sharply higher, up nearly 2% to jump above the 20000 point level, closing at 20145 points. The daily chart is looking a lot more boisterous here with a series of step ups since the nadir in October last year. Daily momentum is nearly overbought and it looks like weekly support at the 19000 point level is quite firm as traders bet on a post zero-COVID economic liftoff:
Japanese stock markets were closed but will reopen today with Nikkei 225 futures indicating a small drop likely to start the new trading year. The steep appreciation in Yen may result if further selling as this market has been in decline since mid December, rolling over through to long term support at the 26000 point level with daily momentum still clearly oversold:
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