Menu

Search

  |   Market Roundups

Menu

  |   Market Roundups

Search

Asia Roundup: Aussie hits 1-year low, dollar slumps against yen as Trump threatens more China tariffs, Asian shares at 4-month troughs - Tuesday, June 19th, 2018

Market Roundup

  • Trump threatens China with new tariffs on $200 bln in goods
     
  • China says will 'fight back firmly' if U.S. publishes additional tariffs
     
  • PBOC injects medium-term liquidity in surprise move as trade war escalates
     
  • U.S. Senate passes defense bill, battle looms with Trump over China's ZTE
     
  • PM May's Brexit laws rejected by parliament, Wednesday showdown looms
     
  • Bavarians put Merkel on notice to win EU migrants deal
     
  • As outrage grows over children, White House defends immigration policy
     
  • N.Korea's Kim in China; U.S., S.Korea suspend military drill
     
  • Australia's central bank more upbeat on growth, but still no rush on rates-minutes
     
  • Australia Q1 Home Price Index, -0.7%, f’cast -1.0%, last 1.0%
     

Economic Data Ahead

  • (0400 ET/0800 GMT) EZ Apr Current Account NSA EUR, last 40.6 bln
     
  • (0400 ET/0800 GMT) EZ Apr Current Account SA, EUR, 32.0 bln

Key Events Ahead

  • (0400 ET/0800 GMT) ECB's Mario Draghi speaks at ECB Forum on Central Banking - Sintra, Portugal
     
  • (0430 ET/0830 GMT) ECB's Peter Praet chairs Session 1 "Macroeconomics of price and wage-setting" - Sintra
     
  • (0500 ET/0900 GMT) Former Fed Chairman Paul Volcker and Federal Deposit Insurance Corp's Thomas Hoenig speak at an event - New York City
     
  • (0615 ET/1015 GMT) ECB's Pentti Hakkarainen speaks at House of Finance - Frankfurt
     
  • (0700 ET/1100 GMT) ECB's Peter Praet chairs panel "Macroeconomics of price and wage-setting" - Sintra
     
  • (0700 ET/1100 GMT) Fed's Bullard makes presentation on "Macroeconomics of Price and Wage Setting" - Sintra
     
  • (0700 ET/1100 GMT) Slovakia Central Bank Governor Jozef Makuch holds news conference - Bratislava
     
  • (0900 ET/1300 GMT) Introductory statement by ECB's Daniele Nouy at European Parliament - Brussels
     
  • (1950 ET/23:50 GMT) BOJ releases Minutes of Monetary Policy Meeting - Tokyo N/A Bank of Finland's Erkki Liikanen holds press conference - Helsinki
     
  • N/A ECB's Mario Draghi and Peter Praet, Fed's James Bullard and Central Bank of Ireland's Philip Lane speak at ECB Forum on Central Banking - Sintra
     

FX Beat

DXY: The dollar index steadied after falling to a 3-day low earlier as U.S. President Donald Trump's threats of more tariffs on China raised worries about an escalating trade war between the U.S. and China. The greenback against a basket of currencies trades 0.05 percent up at 94.77, having touched a high of 94.03 on Wednesday, its highest since June 5. FxWirePro's Hourly Dollar Strength Index stood at 118.94 (Highly Bullish) by 0500 GMT.

EUR/USD: The euro rose, extending gains for the third straight session amid a dispute in Germany's governing coalition and expectations the European Central Bank will hold interest rates steady into 2019. The European currency traded 0.05 percent up at 1.1626, having touched a low of 1.1543 on Friday, its lowest since May 30. FxWirePro's Hourly Euro Strength Index stood at 4.07 (Neutral) by 0400 GMT. Investors’ attention will remain on series of data from the Eurozone economies, EZ current account and ECB Draghi and Praet, ahead of U.S. building permits and housing starts. Immediate resistance is located at 1.1650, a break above targets 1.1699 (21-DMA). On the downside, support is seen at 1.1510 (May 29 Low), a break below could drag it till 1.1434 (July 2017 Low).

USD/JPY: The dollar tumbled below the 110.00 handle to hit a 1-week low amid escalating trade dispute between the United States and China, in which both sides have threatened stiff tariffs on each others' key export goods. The major was trading 0.7 percent down at 109.72, having hit a low of 109.67 earlier, its lowest since June 11. FxWirePro's Hourly Yen Strength Index stood at 26.54 (Neutral) by 0400 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. building permits and housing starts. Immediate resistance is located at 110.01 (June 6 High), a break above targets 110.49 (June 6 High). On the downside, support is seen at 109.37 (June 4 Low), a break below could take it lower 109.19 (June 8 Low).

GBP/USD: Sterling rose, reversing some of its previous session losses, as the U.S.dollar weakened amid escalating trade dispute between the United States and China. However, traders were reluctant to take long positions ahead of a Bank of England policy meeting this week and another expected parliamentary confrontation over the government's Brexit plans. The major traded 0.1 percent up at 1.3262, having hit a low of 1.3211 on Friday; it’s lowest since May 29. FxWirePro's Hourly Sterling Strength Index stood at -51.42 (Bearish) 0400 GMT. Immediate resistance is located at 1.3305 (5-DMA), a break above could take it near 1.3439 (June 8 High). On the downside, support is seen at 1.3204 (May 29 Low), a break below targets 1.3169 (Nov. 17 Low). Against the euro, the pound was trading 0.1 percent up at 87.68 pence, having hit a high of 87.17 pence on Friday, it’s highest since May 30.

AUD/USD: The Australian dollar slumped to a 1-year  low as intensifying trade tensions between the United States and China undermined the outlook for global growth. The Aussie trades 0.5 percent down at 0.7383, having hit a low of 0.7382 earlier; it’s lowest since June 2017. FxWirePro's Hourly Aussie Strength Index stood at -164.26 (Highly Bearish) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7371 (June 2 Low), a break below targets 0.7328 (May 28, 2017, Low). On the upside, resistance is located at 0.7444, a break above could take it near 0.7497 (5-DMA).

NZD/USD: The New Zealand dollar tumbled to a near 3-week low after Beijing responded with tariffs of its own, leading U.S. President Trump to threaten a 10 percent tariff on $200 billion of Chinese goods. The Kiwi trades 0.3 percent down at 0.6917, having touched a low of 0.6912 earlier, its lowest level since May 30. FxWirePro's Hourly Kiwi Strength Index was at -45.15 (Neutral) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6960, a break above could take it near 0.676 (21-DMA). On the downside, support is seen at 0.6905 (May 25 Low), a break below could drag it below 0.6882 (May 30 Low).

Equities Recap

Asian shares tumbled to a 4-month low as U.S. President Donald Trump threatened new tariffs on Chinese goods in an escalating trade war between the world's two biggest economies.

MSCI's broadest index of Asia-Pacific shares outside Japan slumped 1.5 percent.

Tokyo's Nikkei plunged 1.8 percent to 22,278.48 points, Australia's S&P/ASX 200 index eased 0.05 percent to 6,102.10 points, and South Korea's KOSPI tumbled 1.6 percent to 2,337.72 points.

Shanghai composite index fell 4.3 percent to 2,891.50 points, while CSI300 index was trading 3.8 percent down at 3,611.05 points.

Hong Kong’s Hang Seng was trading 2.8 percent lower at 29,426.16 points. Taiwan shares shed 1.7 percent to 10,904.19 points.

Commodities Recap

Crude oil prices declined on expectations that producer cartel OPEC and Russia will gradually increase output after withholding supplies since 2017. International benchmark Brent crude was trading 0.7 percent up at $74.77 per barrel by 0409 GMT, having hit a low of $72.44 the day before, its lowest since May 2. U.S. West Texas Intermediate was trading 0.6 percent down at $65.43 a barrel, after falling as low as $63.62 on Monday, its lowest since April 10.

Gold prices rebounded from multi-month lows, boosted by a weaker dollar and a drop in Asian stocks as a trade war between the United States and China intensified. Spot gold was 0.4 percent up at $1,283.45 an ounce by 0412 GMT, having touched its weakest since late December at $1,275.01 an ounce on Friday. U.S. gold futures for August delivery were also 0.3 percent higher at $1,283.80 per ounce.

Treasuries Recap

The 10-year U.S Treasury yield stood at 2.876 percent lower by 0.049 bps, while 5-year yield was 0.053 bps down at 2.748 percent.

The Japanese government bonds gained after U.S. President Donald Trump terrorizes additional tariffs on Chinese goods in an escalating trade war between the world's two biggest economies. The yield on the benchmark 10-year JGB note, which moves inversely to its price, fell 1/2 basis point lower at 0.034 percent, the yield on the long-term 30-year note also dipped 1/2 basis point to 0.714 percent and the yield on short-term 2-year moved 1/2 basis point down to -0.135 percent.

The Australian government bonds rallied as investors moved to safe-haven buying after U.S. President Donald Trump threatened to hit China with new tariffs on $200 billion. The yield on Australia’s benchmark 10-year Note, which moves inversely to its price, fell 4 basis points to 2.629 percent (nearly 3-week low), the yield on the long-term 30-year Note dipped 4 basis points to 3.138 percent and the yield on short-term 2-year down 1/2 basis point to 1.997 percent.

The New Zealand government bonds ended Tuesday’s session on a higher note after U.S. President Donald Trump threatens with extra tariffs on $200bln of Chinese goods, intensifying trade war fear among investors. At the time of closing, the yield on the New Zealand benchmark 10-year note, which moves inversely to its price, slumped 4 basis points to 2.880 percent, the yield on the long-term 20-year fell 5 basis points to 3.195 percent and the yield on short-term 2-year too closed nearly flat at 1.890 percent.

The Canadian government bond prices were higher across much of the yield curve. The two-year rose 3.5 Canadian cents to yield 1.873 percent and the 10-year climbed 14 Canadian cents to yield 2.202 percent.

  • Market Data
Close

Welcome to EconoTimes

Sign up for daily updates for the most important
stories unfolding in the global economy.