image

Asia Stocks Hit 2021 Lows as China Skids, Funds Favour Wall St

“We believe China’s economy, and specifically its financial system, will face significant risks in coming months due to the unprecedented tightening measures applied to the property sector,” economists at Nomura warned in a note.

That dragged MSCI’s broadest index of Asia-Pacific shares outside Japan down 2.0% to its lowest since last December. Japan’s Nikkei did bounce 0.9%, but that was off a seven-month low.

In contrast, Nasdaq futures were off just 0.1% from historic highs, and S&P 500 futures were down 0.3%. EUROSTOXX 50 futures and FTSE futures both dipped 0.5%.

More than one-third of S&P 500 companies are set to report quarterly results this week, headlined by Facebook Inc, Tesla Inc, Apple Inc, Alphabet Inc, Microsoft Corp and Amazon.com.

With just over one-fifth of the S&P 500 having reported, 88% of firms have beaten the consensus of analysts’ expectations. That is a major reason global money managers have poured more than $900 billion into U.S. funds in the first half of 2021.

Oliver Jones, a senior markets economist at Capital Economics, noted U.S. earnings were projected to be roughly 50% higher in 2023 than they were in the year immediately prior to the pandemic, significantly more than was anticipated in most other major economies.

“With so much optimism baked in, it seems likely to us that the tailwind of rising earnings forecasts, which provided so much support to the stock market over the past year, will fade,” he cautioned.

The week is also packed with U.S. data that should underline the economy’s outperformance. Second-quarter gross domestic product is forecast to show annualised growth of 8.6%, while the Fed’s favoured measure of core inflation is seen rising an annual 3.7% in June.

The Federal Reserve meets on Tuesday and Wednesday and, while no change in policy is expected, Chair Jerome Powell will likely be pressed to clarify what “substantial further progress” on employment would look like.

“The main message from Fed Chair Powell’s post-meeting press conference should be consistent with his testimony before Congress in mid-July when he signalled no rush for tapering,” said NatWest Markets economist Kevin Cummins.

“However, he will clearly remind market participants that the taper countdown has officially begun.”

So far, the bond market has been remarkably untroubled by the prospect of eventual tapering with yields on U.S. 10-year notes having fallen for four weeks in a row to stand at 1.26%.

The drop has done little to undermine the dollar, in part because European yields have fallen even further amid expectations of continued massive bond buying by the European Central Bank.

The single currency has been trending lower since June and touched a four-month trough of $1.1750 last week. It was last at $1.1779 and looked at risk of testing its 2021 low of $1.1702.

The dollar has also been edging up on the yen to reach 110.40, but remains short of its recent peak at 111.62. The fall in the euro has lifted the dollar index to 92.870, a long way from its May trough of 89.533.

The rise in the dollar has offset the drop in bond yields to leave gold range-bound around $1,800 an ounce.

Oil prices have generally fared better amid wagers that demand will remain strong as the global economy gradually opens and supply stays tight.

The U.S. and European oil giants are expected to announce higher profits, cash and dividend payments this week.

Brent was trading down 73 cents at $73.37 a barrel, while U.S. crude fell 76 cents to $71.31.

(Editing by Sam Holmes and Edmund Klamann)


Source link

0 0 votes
Article Rating

S’abonner
Notifier de
0 Commentaires
Commentaires en ligne
Afficher tous les commentaires
Reset Password

Avertissement sur les risques :

Le trading peut vous exposer à des risques de pertes supérieures aux dépôts et ne convient qu’à une clientèle avisée ayant les moyens financiers de supporter un tel risque. Les CFD sont des instruments complexes et présentent un risque élevé de perte rapide en capital en raison de l’effet de levier. Entre 74 et 89% des comptes de clients de détail perdent de l’argent lors de la négociation de CFD. Vous devez vous assurer que vous comprenez comment les CFD fonctionnent et que vous pouvez vous permettre de prendre le risque élevé de perdre votre argent. Ce site n’est en aucun cas une offre de conseil en investissement ni une incitation quelconque à acheter ou vendre des instruments financiers. Trader le Forex et/ou les CFD’s implique un niveau de risque élevé, et peut ne pas être approprié car vous pouvez subir des pertes supérieures à votre dépôt. L’effet de levier peut être en votre défaveur.

Vous devez être conscient et avoir une compréhension complète de tous les risques associés au marché et au trading. Le site Union-trader.com peut être amené à produire des commentaires d’ordre général, ce qui ne constitue pas des conseils en investissement et ne doit pas être interprété comme tel.

Veuillez recourir aux conseils d’un conseiller financier extérieur. Le site Union-trader.com décline toute responsabilité pour les erreurs, inexactitudes ou omissions et ne garantit pas l’exactitude ou le caractère complet des informations, textes, graphiques, liens ou autres éléments contenus dans cette documentation. Toute information et toute mise à disposition sur le site ont un caractère privé.