Asian markets rise as White House appears on back foot w.r.t. tariffs

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IC Markets Market Review
IC Markets Market Review

Global Markets:

  • Asian Stock Markets : Nikkei up 0.60%, ASX up 0.79%
  • Commodities : Gold at $1336.55 (-0.46%), Silver at $14.87 (-0.25%), Brent Oil at $62.54 (+1.41%), WTI Oil at $53.30 (+1.35%)
  • Rates : US 10-year yield at 2.124, UK 10-year yield at 0.826, Germany 10-year yield at -0.231

News & Data:

  • (CAD) Trade Balance -1.0B vs -2.8B expected
  • (EUR) Main Refinancing Rate 0.00% vs 0.00% expected
  • Trump’s Currency War Plan Puts Treasury and Commerce at Odds
  • PBOC’s Yi: Talks on trade with US Treasury Secretary Steven Mnuchin at G20 to be “difficult”
  • Australia’s central bank adjusts liquidity backstop for banks

Markets Update:

Asian stock markets are in positive territory on Friday amid cautious trades following the overnight gains on Wall Street after a Bloomberg News report indicated the U.S. administration will likely delay tariffs on Mexican imports. Markets in China and Hong Kong are closed on Friday for a holiday.

However, the White House later said it still intends to impose tariffs on Mexican imports Monday. Talks are set to resume on Friday. Investors are also cautious ahead of the U.S. jobs data for May to be released later in the day. The strength of the jobs data could have a notable impact on the prospects for a near-term interest rate cut by the Federal Reserve.

The Nikkei 225 in Japan rose 0.6% in afternoon trade, with shares of robot maker Fanuc gaining 1.39%. The Topix index also rose 0.4%. In Australia, the ASX 200 gained 0.8% as most of the sectors traded higher. Over in South Korea, the Kospi traded flat.

Two-year Treasury yields were near their lowest since December 2017 at 1.88%, having fallen 28 basis points in just two weeks. The dollar has at least steadied on the yen at 108.44 and was off the recent five-month low of 107.80. It fared less well on the euro which was currently holding gains of almost 1% for the week at $1.1273. The single currency bounced sharply overnight after the European Central Bank pushed back the timing of any rate hike, but failed to canvass the policy easing that many had wagered on.

Oil prices regained a little ground after a rough week but was still vulnerable to worries about global demand and oversupply.

Upcoming Events:

  • 08:30 AM GMT – (CAD) Employment Change
  • 08:30 AM GMT – (CAD) Unemployment Rate
  • 08:30 AM GMT – (USD) Average Hourly Earnings m/m
  • 08:30 AM GMT – (USD) Non-Farm Employment Change
  • 08:30 AM GMT – (USD) Unemployment Rate
  • &more…

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