Asian equities nervously mixed

FOMC minutes stabilize equity markets

Wall Street’s leading indices finished the session modestly lower overnight. That belied the intra-day volatility, though, with stocks gyrating in huge ranges before the FOMC minutes restored a sense of order. An on-message Fed lifting spirits after a day of inflation and crypto nerves. Back to the real world, the other noteworthy development overnight came from the FOMC minutes. The minutes both steadied the intra-day ship by staying on super-easy until our goals are achieved message, while at the same time fraying nerves as talk to planning to start talking about tapering was mentioned. Part of the sell-off intra-day was likely due to the cryptocurrency cremation, with liquidated longs selling stocks to raise cash. The S&P 500 fell 0.29%, with the Nasdaq almost unchanged and the Dow Jones retreating by 0.48%.

 

Asian markets have looked at the price action on Wall Street overnight and wisely decided to remain on the sidelines awaiting further developments, especially with a light data calendar. The day is mixed in Asia, with the Nikkei 225 up just 0.25%. South Korea has returned from holiday with the Kospi playing catchup on its way to a loss of 0.50%. Hong Kong is much the same and has fallen 0.80%.

 

Mainland China’s Shanghai Composite and CSI 300 are unchanged, while Singapore has risen 0.30% while Taipei has retreated by 0.95%. Kuala Lumpur is flat, while Jakarta has risen 0.70%, powered by improving trade data just released today. Australian markets have rebounded sharply after yesterday’s torrid session, with steadying nerves pushing the ASX 200 1.25% higher and the All Ordinaries climbing 0.75%.

 

With US index futures unchanged in Asia, the mixed performance regionally, and the cautious ranges, suggest Europe will open higher today after catching a crypto-cold yesterday. Overall, the tail-chasing day-to-day behaviour in stock markets suggests a significant move is coming; my money is on a downward if possibly a brief correction.

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.

Jeffrey Halley

Jeffrey Halley

Senior Market Analyst, Asia Pacific
With more than 30 years of FX experience – from spot/margin trading and NDFs through to currency options and futures – Jeffrey Halley is OANDA’s senior market analyst for Asia Pacific, responsible for providing timely and relevant macro analysis covering a wide range of asset classes. He has previously worked with leading institutions such as Saxo Capital Markets, DynexCorp Currency Portfolio Management, IG, IFX, Fimat Internationale Banque, HSBC and Barclays. A highly sought-after analyst, Jeffrey has appeared on a wide range of global news channels including Bloomberg, BBC, Reuters, CNBC, MSN, Sky TV, Channel News Asia as well as in leading print publications including the New York Times and The Wall Street Journal, among others. He was born in New Zealand and holds an MBA from the Cass Business School.
Jeffrey Halley
Jeffrey Halley

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