Spreadex Market Update
Risk sentiment rattled by China Covid unrest
Equities Under Pressure
Equities prices are seeing a more muted start to the week against a backdrop of uncertainty around civil unrest in China. Added to this, safe-haven demand for USD is also adding downside pressure. If events in China intensify this week equities look vulnerable to further losses near-term. However, if the situation calms down, attention should turn back to the less hawkish outlook for the Fed, with USD set to cool further if the prospect of a smaller December hike gains more traction. In this scenario, equities should be seen higher across the week.
Risk FX Falling, JPY Stronger on Safe-Haven Demand
In FX, a softer tone to risk markets on Monday is seeing fresh safe-haven support for JPY. The Yen has been higher across the board over late Asian and early European trading today with headline moves against risk currencies, such as AUD and NZD, which are seeing the weakest performance so far today. With events in China ongoing, traders will be closely monitoring headlines which look set to continue to shape price action ahead of the US labour reports later in the week.
RBA’s Lowe Optimistic Over Soft Landing Chances
Overnight, RBA governor Lowe struck an optimistic tone noting that the bank feels the domestic economy has a stronger chance at achieving a soft landing when compared with most of its peers. While Lowe remains concerned about demand in the economy, and is watching the housing and energy market, Lowe drew confidence from the country’s contained wages growth when compared with other developed economies.
Metals Weaker, Oil Hits Fresh 2022 Lows
In the metals and commodities space, both gold and silver are seeing a softer start to the week with USD picking up safe-haven demand. For now, both remain slightly off recent highs but are yet to make a fresh downturn. Crude prices have been knocked sharply lower, hitting fresh 2022 lows as renewed fears for the demand outlook in China weigh on sentiment. Focus this week will shift to the upcoming OPEC meeting with risks of further production cuts to be announced in light of the ongoing downtrend in oil prices.
It's easy to open an account
- Fill in our simple online application form
- Fund your account
- Start trading the global markets instantly!
SEARCH FOR AN ARTICLE:
Enter a keyword and search for all relevant articlesMARKET ANALYSIS
RECENT POSTS
DISCLAIMER
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 64% of retail investors lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money. For professional clients, spread betting and CFD trading can also result in losses larger than your initial stake or deposit.
Spreadex Ltd is authorised and regulated by the Financial Conduct Authority, provides an execution only service and does not provide advice in any way. Nothing within this update should be deemed to constitute the provision of investment advice, recommendations, any other professional advice in any way, or a record of our trading prices. This update does not constitute or form part of an offer of, or solicitation for a transaction in any financial instrument, nor shall it or the fact of its distribution form the basis of, or be relied on in connection with, any contract therefore. Any persons placing trades based on their interpretation of the comments or information within this update does so entirely at their own risk.
No representation, warranty, or undertaking, express or limited, is given as to the accuracy or completeness of the information or opinions contained within this update by Spreadex Ltd or any of its employees and no liability is accepted by such persons for the accuracy or completeness of any such information or opinions. As such, no reliance may be placed for any purpose on the information and opinions contained within this update.
The information contained within this update is the intellectual property of Spreadex Ltd and is protected by UK and International copyright laws. All rights reserved. Users may however freely download, distribute and reproduce extracts of the contents, subject always to accrediting Spreadex Ltd as the source and providing a hyperlink to www.spreadex.com.
