Can Stocks Recover from the Trade Wars?
Rowan Crosby • 1 min read
Last week ended on another down note for equity markets as President Trump appeared to be less than impressed with China’s ability to put a deal together.
The week was clearly derailed early on when China devalued the Yuan significantly against the Greenback and that saw markets selling off.
The SPX closed Friday down -0.66% and that will likely weigh on Asian markets this morning. The USD is sharply lower, falling all the way back to the 97.00 level in a worrying sign for the economy.
GOLD was the big mover last week and we saw it pull back under the key $1500 level and that will be the big test for the yellow metal as the new week gets underway.
The GBP/USD will also be on watch today after some less than impressive GDP figures sunk the Pound and even a soft USD couldn’t save it.
Asian Market Outlook
Last week it was really all about the NZD/USD after the RBNZ slashed official interest rates by 50bp. The sell-off continued right into the close on Friday and price is well under the 0.6500 level. However, it did rebound off the lows throughout the week. There will be some second-tier data out today, but nothing market-moving for the Kiwi.
The AUD/USD will be waiting on the official jobs data this week. It too is weak and the RBA has linked the fate of their monetary policy to see the jobless rate fall under 5.2%.
Meanwhile, we will also see data out of China on Industrial Production. The last few weeks have seen some OK numbers from China so this one will be a must-see event.