Asian stocks are down and Gold down to 1247 because of the strength of the US dollar
Asian equities took a beating on the first day of the week. Unsurprisingly, trade worries were at the heart of market weakness, with mainland Chinese equities specifically record a sharp retreat as market participants looked anxious to July 6. July 6 will mark that the that US tariffs on $34 billion of Chinese products are set to take effect, with Beijing sure to impose its own.
On the Forex side, the euro was affected by news that Germany’s interior minister had resigned over immigration policy, while the Mexican peso made strong advances as voters handed leftist Andres Manuel Lopez Obrador a clear presidential election victory. The greenback held its own again the Japanese Yen, which has shown the reaction to a quite robust Tankan business survey.
As for Asian equities, the Shanghai Composite was down 1.2% with the most regional index also down, while the Hong Kong’s Hang Seng provided the only patch of green, while the Nikkei 225 shed 1.9%.
As for commodities, gold prices were trading lower as the greenback strengthened, while crude oil prices traded down on the prospects of increased Saudi supply
Looking ahead, market participants would direct their attention to the UK Manufacturing PMI data.
EURUSD: EUR/USD stayed in consolidation last week and the outlook is unchanged.
GBPUSD: GBP/USD edged lower to 1.3050 last week but recovered since then.
USDCAD: USD/CAD edged higher to 1.3385 last week but formed a short-term top there.
USDCHF: USD/CHF tried to break 0.9990 resistance last week but failed and reversed.
USDJPY: USD/JPY’s breach of 110.90 last week suggests that rebound from 108.10 is resuming.
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