At the halfway point in today’s Asian session, most indices are nursing losses which is a continuation from the US session, where investors were cautious ahead of the US earning season that starts with Alcoa set for release after US market close on Tuesday.
In Japan, Nikkei 225 started off lower and traded firmly in the red following yesterday’s under-performance amid expectations for economic growth in the near future driven by a fiscal stimulus package. The local index is weighed by financial sectors where Aozora Bank has suffered most due to reports that the Co.’s largest shareholder is to sell their controlling stake after the stock tripled over the last three years. In terms of the currency markets, JPY strength has been observed across the board after USD/JPY broke Monday’s European session lows of 87.63, however, the pair spiked higher by 37 pips after Japanese finance minister Aso’s comments saying Japan is to buy ESM bonds using foreign exchange reserves.
Over in Shanghai, the local bourse took a sharp move to the downside around one hour after the open, with the insurance sector being the biggest laggard, in which China Pacific is leading the way down after premarket reports that Carlyle Group would sell Co. shares to raise HKD 1.6bln.
AUD/USD had moved slightly lower in reaction to the release of the disappointing trade balance data, which came at AUD -2.637bln vs. Exp. -2.300bln. However, market participants are likely to concentrate on the upcoming Chinese trade balance data later this week, given their importance to the outlook of Australia's commodity exports.
Looking forward, Australian Foreign Reserves for December is set to hit the wires at 0530GMT/2145CST.
As of 0250 GMT:
ASX200 (-0.08%), Nikkei 225 (-0.48%), Shanghai Comp. (-0.57%), Hang Seng (-0.50%), KOSPI (-0.36%)
08 Jan 2013 - 03:50 - - Source: RANsquawk
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