- Asian equities have tumbled amid a strong rebound in DXY ahead of US ISM PMI.
- Oil prices have recorded their first monthly loss after a spell of six monthly gains.
- Chinese equities have displayed less underperformance on the upbeat Caixin Manufacturing PMI data.
Markets in the Asian domain have witnessed a steep fall as the US dollar index (DXY) has rebounded formerly in the Asian session after a sheer downside move on Thursday. The DXY tumbled after failing to recapture a 19-year high at 105.79. However, a decent recovery in the asset has driven it to near the critical resistance of 105.00.
At the press time, Japan’s Nikkei225 tumbles 1.86%, China A50 eased 0.67%, Hang Send slipped 0.62%, and Nifty50 surrendered 1.44%.
Chinese equities have fallen less in proportion to other indices amid the upbeat Caixin Manufacturing Purchase Managers Index (PMI). The economic data has landed at 51.7, higher than the estimates and the former release of 50.1 and 48.1 respectively. A higher-than-expected economic data indicate that the production activities are operating at a decent pace and the aggregate demand for the manufactured products is advancing firmly.
On the oil front, escalating recession fears have overshadowed the supply worries again. The black gold has recorded monthly losses for the first time after a spell of six monthly gains. Western central banks have ridiculously trimmed their demand forecasts amid advancing price pressures. The households in the western countries are facing the consequences of a real income shock. Higher price pressures have lowered their ‘paychecks’ and henceforth the overall spending quantity-wise.
For further guidance, the US Institute of Supply Management (ISM) PMI data will be of utmost importance. As per the preliminary estimates of 55 vs. 56.1 previously reported, an underperformance is expected by the market participants.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stays near 1.0750 following Monday's indecisive action
EUR/USD continues to fluctuate in a tight channel at around 1.0750 after posting small gains on Monday. Disappointing Factory Orders data from Germany limits the Euro's gains as investors keep a close eye on comments from central bankers.
GBP/USD retreats below 1.2550 as USD recovers
GBP/USD stays under modest bearish pressure and trades below 1.2550 in the European session on Tuesday. The cautious market stance helps the USD hold its ground and doesn't allow the pair to regain its traction. The Bank of England will announce policy decisions on Thursday.
Gold price turns red below $2,320 amid renewed US dollar demand
Gold trades in negative territory below $2,320 as the souring mood allows the USD to find demand on Tuesday. Nevertheless, the benchmark 10-year US Treasury bond yield stays below 4.5% and helps XAU/USD limit its losses.
Ripple lawsuit develops with SEC reply under seal, XRP holders await public redacted versions
Ripple lawsuit’s latest development is Securities and Exchange Commission (SEC) filing, under seal. The regulator has filed its reply brief and supporting exhibits and the documents will be made public on Wednesday, May 8.
The impact of economic indicators and global dynamics on the US Dollar
Recent labor market data suggest a cooling economy. The disappointing job creation and rising unemployment hint at a slackening demand for labor, which, coupled with subdued wage growth, could signal a slower economic trajectory.