Asian stocks remain on back foot amid risk aversion

  • Asian equities remained mostly in losses at the Monday’s start on risk-off sentiments.
  • Worries concerning US-China trade deal, Brexit and global economic growth remained in highlight.

Asian stocks stretched Friday’s losses forward during initial Monday as risk aversion pushed global investors off equities. The US-China trade talks, worries concerning global growth and the US politics are likely main catalysts challenging market optimism. With the traders avoiding stocks in search of safety, the US Dollar extended previous gains on its safe haven appeal.

Markets in China remained mostly volatile as an opening after a weeklong holiday pushed investors to act on the news already out. The MSCI’s Asia Pacific Index outside Japan was down 0.1% whereas shares in Australia and South Korea were down 0.6% and 0.2% respectively. It should also be noted that Japanese markets are off due to National Foundation Day.

Latest comments from the US policymakers are indicating a tough road ahead of negotiations begin in Beijing between the US and Chinese decision makers. The US team includes trade representative Robert Lighthizer and Treasury Secretary Steven Mnuchin while Chinese leaders comprises President's top aide Liu He among others. Both the sides will begin two-day discussion on February 14.

Recently, the White House Adviser Larry Kudlow dimmed prospects of a successful trade deal with China by mentioning that both the sides are too far from any solution. Adding to that, the US President Donald Trump worsened the sentiments by declining to meet Chinese President before the end of 90-day negotiation period on March 01.

On the other hand, intermediate spending to the US government offices will come to an end on Friday before which the policymakers have to be ready with a plan otherwise another showdown will begin. Mr. Trump is tough on his demand surrounding Mexico while opposition is ready for technological advancements for security but not the border.

Moreover, issues concerning Brexit and expected weakness in global growth continues to question equity market performance.

Hence, while US-China deal is a major factor driving risk-off, uncertainty concerning Brexit and global growth can add weakness into the stocks unless any positive developments.

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.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD advances 1.10 amid upbeat trade headlines, after mixed US retail sales

EUR/USD is trading closer to 1.1050, up on the day. US Commerce Secretary Ross has expressed optimism about reaching a deal with China. The Retail Sales Control Group met expectations with 0.3%.


GBP/USD soars past 1.2900 as Farage gives additional boost to Conservatives

GBP/USD has leaped above 1.29, the highest since early November, as the Brexit Party has failed to field candidates in 43 additional seats, facilitating a victory for PM Boris Johnson.


USD/JPY clings to gains near session tops, around 108.70 post-US data

The USD/JPY pair maintained its strong bid tone near session tops and had a rather muted reaction to the mixed US economic data.


Gold looks to close week with small gains below $1,470

The precious metal struggled to find demand on Friday as the upbeat market mood on renewed hopes of the United States and China reaching a trade deal to avoid a tariff hike in December caused investors to move away from safe havens.

Gold News

Crypto Today: Playing with the thin red line

BTC/USD has fallen below $8,500 during the Asian trading session. A close below this support level would put $7,500 on the trading table. ETH/USD is moving below the 50-period exponential moving average.

Read more