- The leadership of the Chinese XI Jinping for the third term shook the Chinese indexes and Hang Seng.
- S&P500 futures extended gains after a bullish Friday.
- Oil prices fell amid growing recession fears.
Asian domain markets are not following the positive S&P500 futures indices and are showing terrible price movements. Risk sentiment strengthened extremely as yields on US 10 Treasuries fell further to near 4.15%. Meanwhile, the US Dollar Index (DXY) is trying to settle above 112.00 after a roller coaster move.
At press time, Japan’s Nikkei225 gained 0.57%, ChinaA50 plunged 2.93% and Hang Seng witnessed a bloodbath. The index erased 5.53%. Indian markets are closed due to Diwali-Balipratipada.
Chinese markets saw intense selling following the announcement of Chinese President XI Jinping’s third term in office. Investors have drastically dumped stocks amid growing fears of an economic slowdown as China’s leader may favor ideological policies even at the expense of economic growth. Apart from that, the upbeat Gross Domestic Product (GDP) and Trade Balance data failed to spark investor optimism.
Blood spilled on the roads as clues in Hang Seng witnessed a bloodbath. XI Jinping’s continued Chinese leadership has heightened fears of an economic slowdown.
In Japan, the Nikkei225 gains are small compared to the recorded rise of the S&P500. Potential interventions by the Bank of Japan (BOJ) in currency markets against disorderly moves in the yen limited the rise in Japanese equities.
On the oil front, oil prices fell below the crucial $85.00 support amid growing global recession fears. In addition to BDCthe BOJ and the European Central Bank (ECB) announce their monetary policies. The BOJ could maintain its ultra-accommodative stance while the ECB could tighten its Monetary Policy. The expectation of another period of rate hikes is weighing on oil prices.