Mixed trading day in Asia as shares were mixed overnight and early gains on many markets were eroded and replaced with losses. A late rally on the Hang Seng though saw a firmer close as the market ended 94 points higher. The Nikkei225 though closed 34 points lower after losses of 296 points on Friday on Wall Street.
Concerns about U.S. Corporate earnings and a slowdown in global economic growth remain the themes that are troubling the markets.
Mainland Chinese equity markets continued their decline with losses as much as 3.3% in early trading although these were pared by the market close. A lot of economic data over the weekend as well as some poor corporate earnings of their own reiterated that we are looking at an economy that is ‘cooling off’.
Opening calls for both the FTSE and DAX were strong this morning after strength in DOW futures allowed for a positive start to the day. The FTSE and DAX were called up 50 and 75 points respectively at the opening bell.
Philip Hammond presents his budget today in the U.K. and as this is the final annual budget before leaving the EU in March 2019, markets will keep a close eye on announcements. Economic growth in the United Kingdom is significantly below other developed nations and needs a boost. Theresa May has also pledged an ‘end to years of austerity’, so this will be equally well monitored.
Commodities had mixed fortunes last week. Oil posted its third straight weekly loss whilst GOLD climbed as high as 1243 late last week, hitting a three month high and the fourth week in a row that it had appreciated. The situation in Saudi Arabia, a possible democrat win in the Mid-Term’s and the rout in the stock markets all contribute to seeing GOLD well bid at these levels.
The Dow and S+P are now trading lower for 2018 and one big gain on the markets last week was sandwiched between four big losses.
I remain long GBP/USD