World equities mixed, US data in focus
Hong Kong, Shanghai, Singapore and Bangkok gained, but Sydney, Seoul, Wellington, Manila, Mumbai and Taipei dropped
Asian and European equities were mixed Monday with investors also awaited the release of US data that could play a role in US central bank deliberations ahead of an expected interest rate cut next week.
Hong Kong, Shanghai, Singapore and Bangkok gained, but Sydney, Seoul, Wellington, Manila, Mumbai and Taipei dropped.
London, Frankfurt and Paris dropped at the open.
Tokyo dipped 1.9% as the yen firmed on expectations the Bank of Japan will hike interest rates this month.
After November’s end-of-month rebound across global markets, confidence remains high amid speculation the US central bank could continue easing monetary policy into the new year.
While the odds on a third straight rate cut on December 10 are hovering around 90%, traders will keep a close eye on this week’s batch of indicators to gauge the central bank’s desire to keep on cutting.
Among the reports due for release are private jobs creation, services activity and personal consumption expenditure.
Bets on a cut surged in late November after several of the bank’s policymakers said they backed lower borrowing costs as they were more concerned about the flagging labour market than stubbornly high inflation.
That helped markets recover the losses sustained in the first half of the month, and analysts said they could be in store for an end-of-year rally.
As the clouds of worry that cast an ominous shadow over markets through to mid-November gently dissipate, they give way to new emotions – notably the fear of not participating and the risk of underperforming benchmark targets, said Pepperstone’s Chris Weston.
However, he warned that risk managers remain highly astute to the landmines that could still derail the improving risk backdrop through December.
He cited the possibility the Fed does not cut, or offers a hawkish cut, the Supreme Court’s possible decision on the legality of President Donald Trump’s trade tariffs, and jobs and inflation data.