Asia market morning update - China's data barrage

A positive run is expected for Asia markets this morning, though the watch is on China’s data barrage for how trade will go for the rest of the day.

Source: Bloomberg

The two things that have put us in a cautious state on Wednesday, Brexit concerns and the lack of fresh updates appear negated into Thursday morning here in Asia.

No no-deal Brexit

While the no-deal Brexit possibility is not eliminated with certainty, the UK parliament had at least voted against the likelihood we would be seeing a UK-led no-deal Brexit in the near term, aiding with risk sentiment. To be fair, the outcome of the vote had once again been the broad expectation, but the alternative this round is a high-risk one as we know. Moving on next, given that the majority of 321, against the 278 other members, in the House of Commons are for some sorts of an agreement, it would also be natural to expect that a delay would be necessitated two weeks ahead of the Brexit deadline. This would likely see to the passage of a delay vote in the Thursday session, altogether setting in motion the lowering of risk sentiment as we have seen overnight with markets. GBP/USD traded to a height of 1.3383, though that was amid low liquidity with the morning levels back at 1.328 when last checked. As for the EUR/GBP downtrend, another false break had been seen as we find prices trying again at the 0.8535 support, one to watch.

EUR/GBP Mini

US market’s ‘goldilocks’ glow

Meanwhile on overnight markets, Wall Street had traded higher into the session with more economic data to help dispel growth concerns. The combination of January’s durable goods orders surprise, suggesting positive domestic demand, alongside the tamed producer inflation reading place us back in a state resembling the goldilocks situation as many would suggest. One thing for sure, however, is that this had given US markets a fresh boost. The likes of the S&P 500 index had been seen again testing the 2800 level, which we would have to continue watching for a firmer close above to affirm the continuation of the uptrend.

US 500 Cash ($10)

Asia open

As told, the improved Brexit development coupled with the affirmative US market movement places Asia markets on track for gains this morning. That being said, the attention is set ahead to the data dump from China. Industrial production, retail sales and fixed asset investments will all be released at local time 10am this morning, perhaps one to be watching of seeing the unsteady releases out for February thus far. These will be the numbers to determine the direction for trade in the remaining of the day in Asia.

Yesterday: S&P 500 +0.69%; DJIA +0.58%; DAX +0.42%; FTSE +0.11%


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