Asian equity markets have been unnerved by the fall in US equity index futures this morning, with the region’s markets starting the day in the red. After a mixed session overnight, with the NASDAQ falling 1.25%, the S&P 500 falling 0.46%, with only the Dow Jones in positive territory, S&P 500 e-mini, NASDAQ and Dow Jones futures are all 1.0% lower in Asian trading.

Asia is solidly in the red, with the Nikkei 225 down 0.70% and the Kospi down 1.0%. In China, the Shanghai Composite and CSI 300 are 0.70% lower, with the Hang Seng down 1.70%. Singapore has traced a slight gain of 0.30% after a recovery in Non-Oil Export data this morning. Jakarta and Kuala Lumpur are 0.30%, and the Sydney markets are 0.70% lower.

There is no particular news driving the fall in equities, notably the US ones. Overshadowed by the Fed noise was a weak US Retail Sales, which rose by only 0.60% in August, well below the rise of 1.0% expected. Although it is only one month’s dataset, some discomfort over the US recovery could be setting in. With Washington, DC paralysed on the stimulus front, government cheques finished, Covid-19 rampant, along with hurricanes and forest fires, the US may have seen the best of its easy wins for the initial recovery for now. The retail sales data may be the first sign that all those factors are starting to weigh and emphasises the urgency for Capitol Hill to get its act together.

It appears that with the FOMC behind us and with no real surprises, profit-taking has set in as long positioning is reduced ahead of US employment data this evening. As I have stated previously, after the US equity rout last week, markets can anticipate a lot more two-way price action in the future, as opposed to the linear price action of the previous six months.

Asian stock markets will remain under pressure today unless US index futures recover some of their losses across the session.

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 OANDA’s, its officers or directors. OANDA’s Terms of Use and Privacy Policy apply. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Analysis feed

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!

Latest Analysis

Latest Forex Analysis

Editors’ Picks

EUR/USD challenges weekly lows after mixed Durable Goods Orders

US Durable Goods Orders were up a measly 0.4% in August, missing expectations of 1.0%, although Nondefense Capital Goods Orders ex Aircraft jumped 1.8%. Equities bounce from lows, but the dollar maintains its strength.


GBP/USD loses 1.2700 as the dollar keeps rallying

GBP/USD approaches its weekly low at 1.2674 as demand for the American currency extends into the final trading session of the week. Hopes for a UK trade deal with the EU doing little for Sterling.


Gold: Finally some rest bite as XAU/USD holds at $1865 per ounce

It has not been the best week for the gold bugs as the yellow metal has fallen 4.36% since Monday. At the end of the week, the price has started to consolidate at the USD 1865 per ounce area. 

Gold News

Breaking: ​​​​​​​The IRS makes it hard to pretend you don’t have Bitcoin

The cryptocurrency holders might have a hard time trying to hide their Bitcoins or other digital assets. IRS considers changing the standard 1040 form by including a bold question on the front page:  At any time during 2020, did you sell, receive, send, exchange, or otherwise acquire any financial interest in any virtual currency? 

Read more

WTI moves back to flat and once again trades above $40 per barrel

It has been a mixed Friday for WTI as the price is moving sideways heading into the weekend. All of the excitement was last week when the OPEC+ JMMC decided to keep output levels at their current rate until December.

Oil News

Forex Majors