- The US keeps forwarding towards a full-fledged trade war with new curbs on Chinese companies, threats of further sanctions.
- China’s CPI posted better than forecast numbers but PPI dimmed the charm.
- Markets in Australia and New Zealand benefited from the RBA’s dovish signals.
With the US-China trade news and Chinese inflation numbers portraying a mixed feeling of joy and sorrow, Asian shares wobble ahead of Friday’s European session open.
Earlier during the day, Bloomberg said that the US stops domestic firms to do business with China’s Huawei, via delaying their request for a license. Following that, One America News Network (OANN) rolled out a story showing the US threatening China of further sanctions, ending trade talks if it uses a military option to break the protests in Hong Kong.
At the data front, China’s July month Consumer Price Index (CPI) crossed upbeat forecasts but Producer Price Index (PPI) lagged behind the pessimistic expectations.
As a result, the MSCI’s index of Asia Pacific shares ex-Japan remains nearly 0.2% in gain whereas Japan’s NIKKEI is on its positive run to 0.6%. Further, China’s HANG SENG loses 0.18% but Australia’s ASX 200 and New Zealand’s NZX 50 cheer dovish statements from the Reserve Bank of Australia’s (RBA) Governor, also confirmed through quarterly monetary policy report. Furthermore, India’s BSE SENSEX is gaining 0.9% by the press time as investors cheer the speculations that the Indian government will roll out measures to help Foreign Portfolio Investors.
It is worth noting that global risk sentiment is again turning heavy with the US 10-year treasury yield revisiting sun-1.7% area by the time of writing.
Moving on, the global economic calendar is almost silent, with the UK GDP and Canadian employment data in the spotlight, which in turn highlights trade/political catalysts as major drivers.
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