Asian stocks slip as political/trade catalysts favor risk-off


  • Doubts over US-China trade deal and Hong Kong protests derailed risk sentiment.
  • Less data highlights such qualitative signals for fresh direction.

Be it the trade rift between the US and China or protests in Hong Kong, not to forget the US-Iran tussle, global markets are all disappointed due to the uncertain times that these catalysts offer. As a result, investors prefer risk safety and runoff from Asian equities during early Thursday.

The US President Donald Trump’s tweets and Chinese media took command of challenging the global risk sentiment off-late. Adding to this were the protests in Hong Kong against the Government’s decision to hold a debate on extradition to China that grabbed market attention for the second consecutive day.

As a result, headline Asian shares are in red as indicated by nearly 1% loss of the MSCI’s index of Asia-Pacific shares ex-Japan. It should also be noted that Japan’s Nikkei is down 0.6% by the time of writing.

Further, Australia’s ASX 200 shows little reaction to weaker than forecast unemployment rate as expectations of further monetary easing from China pleased Aussie traders.

Moving on, China’s Hang Seng trims 0.86% due to likely dark days on the trade platform and problems in Hong Kong whereas India’s BSE is also losing around 0.5%.

Overnight, Wall Street also registered losses on trade woes which in-turn dragged the US treasury yield down. The risk barometer currently loses nearly 1.5 basis points to 2.11%.

While political/trade plays are likely to remain present, lack of economic data/event might confine the market momentum.

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