Wall Street fell sharply overnight from a slew of poor US economic data that maybe indicating a hard landing up ahead for 2023, as retail sales and PPI figures slumped. The USD rose against all the majors as a result, with Euro still falling back on rumours the ECB may ease off on its next rate rise while the Australian dollar again rejected the 70 cent level. US bond markets saw sharp tightening with 10 year Treasury yields losing 16 basis points to finish at 3.34% while the commodity complex also saw prices pullback as Brent crude gave up its recent gains to fall below the $85USD per barrel level while gold moderated again with only a minor loss to finish around the $1903USD per ounce level.
Looking at share markets in Asia from yesterday’s session where mainland Chinese share markets lifted just a fraction with the Shanghai Composite closing 0.2% higher to remain above the 3200 point level, finishing at 3224 points while the Hang Seng Index was able to get up further, closing 0.4% higher at 21678 points. The daily chart was looking over extended so this slowdown is not unexpected, with a series of step ups since the nadir in October last year easing off. Daily momentum is getting out of its recent extreme overbought mode which is a good sign but not yet an indicator of a complete top:
Japanese stock markets soared higher on relief from no change in the BOJ position with the Nikkei 225 closing 2.5% higher at 26796 points. There remains the potential for a bottom to develop here at the 25000 point level but this continued oscillation around the BOJ and bond market problems will be exarcebated by Wall Street’s inability to gain traction with daily momentum swinging higher but remaining negative:
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