Asian markets are set for a mixed start after a relatively subdued trading day across the regions. Global equity indices had a steady day yesterday as the market digested the recent updates and looked to Beijing for the next direction. US markets finished the day nicely in the black with the major indices all closing around 0.35% up. The dollar continued to gain ground against most of the majors with the Dxy trading around 97.20 on the Asian open, once again the pound was the big mover as it dropped lower on Brexit uncertainty. Commodities were relatively quiet with the exception of Gold which took a beating on the day, dropping nearly 2% from 1310 down to 1290.
The markets focus will be firmly on Beijing today as the US and China once again sit down for trade talks. Investors are hoping for some signs of progress to bolster sentiment although indications from the US are that this will now be a long process. This may weigh on the market as we move into the weekend, hopes for a quicker resolution to the situation are fading and investors are looking for concrete details and signs that the two presidents will meet to sign an agreement before committing to longer term positive trades. Expect more risk off trade conditions if this looks set to be another step in a lengthy process.
Looking at the rest of todays trading and it’s a relatively quiet day in Asia in terms of economic data announcements and traders will be watching any developments in China closely. UK Current Account and Final GDP numbers are due out early in the London session but once again expect Brexit issues to dominate market focus there. Attention will move north of the border on the US open as the latest release of Canadian GDP data is due however investors will then be looking to the US with the Core PCE Index and Chicago PMI number out later in the day.