Asia follows US with mixed results

Asian equities mixed to finish the week

Wall Street had a volatile intra-day session overnight, with the US Retail Sales jump unwinding the intra-day recovery as Fed tapering prospects were priced in leaving a very mixed finish for the major indices. US Retail Sales for August surprised to the upside, climbing 0.70% versus an expected fall of -0.70%

The S&P 500 fell by 0.15%, the Nasdaq rose by 0.13%, and the Dow Jones fell by 0.18%. More ominously, futures have continued south today. The S&P 500 e-minis are 0.20% lower, the Dow futures have fallen 0.33% while the Nasdaq futures are unchanged. Like overnight markets, US investors appear to be rotating into the apparent safety of tech.

Asia is a mixed bag, with the Nikkei 225 seeing dip-buyers lifting it 0.55% higher. The Kospi is ignoring North Korea uranium enrichment headlines, rising a modest 0.15%. China markets are mixed as China property giant Evergrande’s shares have fallen once again today. Regulatory nerves were balanced by the PBOC injected CNY 90 bio via the 7-day and 14-day repos. The Shanghai Composite has fallen by 0.58% mirroring the Dow, while the CSI 300 has climbed 0.27% and Hong Kong is 0.38% higher.

Regionally, Singapore is down 0.15% with Taipei and Jakarta falling 0.45%, while Jakarta holds at unchanged. Another fall in iron ore overnight, along with heightened tensions with China (again), is weighing on Australian markets today. The ASX 200 is 0.90% lower, while the All Ordinaries is down 0.80%. European markets are likely to open unchanged to slightly down this afternoon after a nervous US close and a mixed day in Asia.

Taking a look ahead, next week’s FOMC meeting is the key inflection point for the taper trade now. Markets will be looking for a signal that the November meeting will be live for the announcement of the taper.

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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