US stocks slide on “Blue Wave” concerns
Wall Street endured one of its worst session in recent times overnight, as election jitters and the US stimulus impasse caused markets to blink that are heavily positioned for the “blue wave.” The S&P 500 fell 2.35%, the Nasdaq fell 2.05%, and the Dow Jones fell 2.28%. The after-market US index futures have eked out tiny gains this morning on profit-taking, but that has not been enough to stop Asia following Wall Street into the red in Tuesday trading.
The Nikkei 225 is 0.40% lower, with the Kospi the region’s outperformer, down only 0.10%. The Kospi’s outperformance is likely due to respectable advance GDP numbers out of South Korea today. China’s Shanghai Composite is 0.40% lower, and the CSI 300 is 0.15% lower.
The news is not so good elsewhere in Asia, with Singapore 0.65% lower and Hong Kong down 1.30%. Australia is the region’s worst performer today, the ASX 200 and All Ordinaries have fallen 1.80%.
Asian markets are benefiting from not buying so enthusiastically into the US stimulus trade as Wall Street. But with Covid-19 crushing European equities, and a re-pricing of risks now occurring in the US, Asia will not be immune. I continue to expect that risk will be taken off the table as the week progresses, meaning that rallies will be short in duration, with risks skewed to the downside.
Ant Financials’ IPO was priced at the very top end of expectations at HKD 80, with the book to close a day early due to demand. The stock is scheduled to start trading in Hong Kong on November the 5th, hopefully after the US election dust has settled. If it hasn’t, all those retail buyers on 20-1 leverage in Hong Kong could be in for an emotional wait for the start of trading. Those hoped-for leveraged easy profits may well be elusive as well.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.