Skip to content

We want to clarify that IG International does not have an official Line account at this time. We have not established any official presence on Line messaging platform. Therefore, any accounts claiming to represent IG International on Line are unauthorized and should be considered as fake.
CFDs are complex instruments. 72% of retail client accounts lose money when trading CFDs, with this investment provider. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money.
CFDs are complex instruments. 72% of retail client accounts lose money when trading CFDs, with this investment provider. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money.

Asia Day Ahead: China’s PMI disappoints, while speculations brew for potential policy tweak from BoJ

Major US indices started the week on a positive note as an attempt to unwind from near-term extreme bearish sentiments, although there are still some reservations in place going into the FOMC meeting this week.

China Source: Bloomberg

Market Recap

Major US indices started the week on a positive note (DJIA +1.58%; S&P 500 +1.20%; Nasdaq +1.16%) as an attempt to unwind from near-term extreme bearish sentiments, although there are still some reservations in place going into the Federal Open Market Committee (FOMC) meeting this week. The VIX is down more than 7%, reversing back below its key 20 level.

Lower oil prices overnight may offer some breathing room for risk sentiments, seemingly reflecting some expectations that the Israel-Hamas conflict may still be contained within the Gaza strip, at least for now. If the conflict were to expand into the wider Middle East, the World Bank forecasts that oil prices may reach a range of $93-$157 a barrel – subdued reaction in oil prices to this suggests that doubts remain on a wider conflict.

US Treasury yields were slightly higher, with the US 10-year yields up 6 basis-points (bp) to 4.892%. There was not much of a trigger, apart from some positioning for a potential hawkish messaging from the Federal Reserve (Fed) this week. Perhaps with China’s Purchasing Managers' Index (PMI) figures out today, one to watch copper prices. Prices have been consolidating lately, with recent attempt to break above the upper resistance failing to find a breakthrough. On the downside, the US$7,885 per tonne level may be a crucial support to hold, failing which could pave the way towards the US$7,515 per tonne level next.

Copper Source: IG charts

Asia Open

Asian stocks look set for a mixed open, with Nikkei -0.19%, ASX +0.45% and KOSPI -0.71% at the time of writing. China’s October official PMI figures continue to point towards subdued growth conditions, with manufacturing activities reversing back into contractionary territory while the services PMI came in at its lowest level since December 2022. The data may dent hopes of a more sustained recovery, given previous upside surprise in September’s numbers, and likely add to calls for more policy support to support the economy.

Ahead, eyes will also be on the Bank of Japan (BoJ) meeting, at a time where the USD/JPY failed to cross the key psychological 150.00 level lately – a previous level of intervention back in October 2022. Its daily Relative Strength Index (RSI) is also ticking below the key 50 level, seemingly reflecting some positioning for a potential policy tweak from the central bank, particularly for its yield curve control (YCC) policy. This comes as Japanese 10-year government bond yields delivered another jump overnight to a fresh decade high to 0.94%, inching closer to the 1% upper ceiling laid out by the BoJ previously.

Any tweak to the upper limit (eg. raising it to the 1.5% level) could trigger a sharp retreat in the USD/JPY, although one may note that downside reaction to the previous YCC tweak has been short-lived. Near-term support to watch for the pair may potentially be at the 147.40 – a level where dip-buying was seen back in 3 October 2023. On the upside, the 150.00 level will serve as resistance to overcome.

USD/JPY Mini Source: IG charts

On the watchlist: EUR/USD’s recovery attempt continues

The EUR/USD continues to hang above its 1.051 level of support, seemingly trading within a rising channel pattern lately as an attempt to recover from its 7% sell-off since July this year. Economic data to start the week brought a stronger-than-expected 3Q flash gross domestic product (GDP) out from Germany, while inflation has also moderated quicker than expected. Oil prices are also struggling to move higher, which provides some breathing room for the pair.

Any breakout of the prevailing channel will be key. If the 1.051 level failed to hold, recent recovery could be a bearish flag formation, which presents a continuation of its downward trend. On the upside, greater conviction for longer-term bulls may have to come from a move back above the 1.080 level, where its Ichimoku cloud resistance on the daily chart is overcome.

EUR/USD Mini Source: IG charts

Monday: DJIA +1.58%; S&P 500 +1.20%; Nasdaq +1.16%, DAX +0.20%, FTSE +0.50%


This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

Seize a share opportunity today

Go long or short on thousands of international stocks.

  • Increase your market exposure with leverage
  • Get spreads from just 0.1% on major global shares
  • Trade CFDs straight into order books with direct market access
Learn more

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

You might be interested in…

<h3>How much does trading cost?</h3>
<h3>Find out about IG</h3>
<h3>Plan your trading</h3>

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.