Asian indices finished in mixed tones with investors awaiting further trade talks in Washington later this week between the US and China. The Chinese government accused the US of trying to block its industrial tech development overnight, and that stirred a few sour tones in Asian trading today.
Chinese equities are lower after posting robust gains yesterday. The Shanghai Composite is down 0.05 percent at 2,750 while in Hong Kong, the Hang Seng index is down by 0.42 percent at 28,228. In Japan, the Nikkei225 was 0.10 percent higher at 21,302, and the Australian stocks have finished firmer for a third straight day, helped by strong gains in the financial sector. The ASX 200 index closed up 0.3% or 17 points to 6106.9.
Crude oil added 28 cents to $56.26/barrel while Brent oil lost 14 cents to $66.36/barrel. The US Dollar index started with 0.09 percent gains at 96.87 while USD is adding 0.12 percent against Yen AT 110.74. The Swedish Krona climbed to 2019 tops above 10.56.
European stocks have started the session on a negative note, with investors playing it safe ahead of another week of US-China trade talks and a slate of economic data due out later in the session.
On the Lookout: European Monetary Union Current Account came in at €32.99B, below analyst’s expectations (€36.2B) in December and the Italian Industrial Orders n.s.a (YoY) came in at -5.3% below forecasts (2.3%) in December just to add to investors worries. The ZEW will release its German Economic Sentiment Index and the Current Situation Index at 10:00 GMT in the EU session later today, reflecting institutional investors’ opinions for the upcoming six months, also at 10:00 GMT, Eurozone December construction output data will be released.
According to the latest Reuters poll of economists, a majority of them believe that the Reserve Bank of Australia (RBA) will keep the Official Cash Rate (OCR) on hold until at least early 2021.
US stocks will resume trade following the President’s Day holiday. The NAHB housing market index is also due for release.
Trading Perspective: ECB’s chief economist Peter Praet earlier in the session said that the ECB could adopt rate guidance if the European economy were to slow sharply. “Biggest problem by far is political uncertainties persisting for so long, related to protectionism, Brexit.” EURUSD is trading slightly lower today just above the 1.13 level. The pair’s immediate hurdle is at yesterday high at 1.1340 while more supply will be met at 1.1390 the 100 day MA. On the downside, first support will be found at 1.1234 the low from February 15th and then key support is at the yearly low around 1.1215.
GBPUSD: The pair currently is trading flat at 1.2922 having posted a session-low level of 1.2892, during the Asia session, but managed to regain positive traction for the second straight session above 1.29. Sterling was supported by the UK Cabinet Office Minister David Lidington’s comments, saying that the UK government might be able to re-negotiate the deal or delay the Brexit term scheduled for March 29. Immediate support for the pair stands at the 100-day moving average at 1.2880 while a break below can force prices down to 1.2828 at the 50-day moving average. On the flipside, strong resistance will be met at the 200-day moving average at 1.3015
