Wednesday 19th September: Investors brush aside trade concerns for now – Asian markets rise

IC Markets Market Review
IC Markets Market Review

Global Markets:

  • Asian Stock Markets : Nikkei up 1.08%, Shanghai Composite up 1.33%, Hang Seng up 1.43%, ASX up 0.43%
  • Commodities : Gold at $1208.10 (+0.43%), Silver at $14.26 (+0.49%), Brent Oil at $79.05 (+0.03%), WTI Oil at $69.64 (+0.07%)
  • Rates : US 10-year yield at 3.050, UK 10-year yield at 1.568, Germany 10-year yield at 0.486

News & Data:

  • (JPY) BOJ Policy Rate -0.10% vs -0.10% expected
  • (NZD) Current Account -1.62B vs -1.23B expected
  • (NZD) GDT Price Index -1.30% vs -0.70% previous
  • (CAD) Manufacturing Sales m/m 0.90% vs 1.00% expected
  • China’s premier just ruled out currency manipulation as a trade war tactic
  • Bank of Japan vows to keep rates very low for an ‘extended period’
  • Two Koreas’ defense chiefs set to ink comprehensive military agreement on reducing tensions
  • U.S. Justice Department probes Musk statement on taking Tesla private

Markets Update:

Asian stock markets are rising on Wednesday following the overnight gains on Wall Street as investors shrugged off an escalation in trade tensions between the world’s two largest economies. In response to tariffs announced by the Trump administration, China said it will retaliate by imposing tariffs on $60 billion worth of U.S. goods, effective September 24.

Japan’s Nikkei 225 was up by over 1 percent as The Bank of Japan kept its monetary policy steady and maintained an upbeat view on the economy. In its policy statement, the central bank said it expects Japan’s economy to “continue its moderate expansion” and that domestic demand is likely to follow an uptrend. Chinese mainland markets were up: the Shanghai composite and the Shenzhen composite were both up by over 1 %. The Australian market is rising following the overnight gains on Wall Street despite escalating U.S.-China trade tensions. Mining stocks are among the leading gainers, reflecting higher copper and iron ore prices.

While global market reaction to the latest phase of the trade dispute has been relatively limited, the U.S.-China row was expected to heat up – a major worry for investors. U.S. Treasury Secretary Steven Mnuchin last week invited top Chinese officials to a new round of talks, but speculation has risen that Beijing would decline to attend after Washington fired its latest trade salvo.

The Australian dollar, seen as a gauge of risk sentiment, stretched its overnight rally and rose to a near three-week peak of $0.7255. Safe-haven U.S. Treasuries were sold and their yields rose on the back of improved investor risk appetite. The benchmark 10-year Treasury yield stood at 3.049 percent after touching 3.059 percent overnight, its highest since May 23. The rise in yields in turn propped up the dollar, which climbed to a two-month high of 112.43 yen. The yen showed little reaction to the Bank of Japan’s well-anticipated decision on Wednesday to keep monetary policy steady. The BOJ also maintained its 10-year Japanese government bond yield target at around zero percent.

Upcoming Events:

  • 09:00 AM GMT – (GBP) MPC Member Haldane Speaks
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