Asian Stocks Up Despoite Ongong Trade Tensions, UK CPI Eyed
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Asian Stocks Talking Points:
- Most Asian stocks rose on Wednesday
- The Bank of Japan left monetary policy alone, China’s Premier said the Yuan would not be devalued
- UK inflation data are coming up in the European day
The DailyFX Third-Quarter Fundamental and Technical Forecasts are out now,
The Australian Dollar got a lift Wednesday from comments made by Chinese Premier Li Keqiang.
Speaking at a World Economic Forum event in Tianjin he said that China would not be devaluing its Yuan in order to stimulate exports. This was taken something of a vote of confidence, despite recent tariff raising between China and the US, and AUD/USD got the best of it. Li also said that Beijing was facing greater difficulties in keeping the domestic economy stable, and this comment may have been behind some of the AUD/USD retracement seen since.
Meanwhile the Japanese Yen was steady as the Bank of Japan did as was universally expected and left its monetary taps wide open for yet another month. There was some cheer in news reports that North Korea had agreed to shut down one of its missile testing and launch sites. The news was apparently relayed via South Korean President Moon Jae-in. Donald Trump hailed it as an exciting development.
Japan’s trade deficit was found to have almost doubled in August, with the sensitive surplus with the US shrinking for a second straight month. The UK Pound retraced some of the gains made in the previous session although some more optimistic Brexit headlines continue to filter out of Brussels and London.
Asian equity investors found something to like in most of the day’s numbers and local stocks traded broadly higher. The Nikkei 225 added 1.3%, with Shanghai, Hong Kong up by nearly 1% apiece as their closes loomed. Seoul’s Kospi was the only notable loser. It failed to hold gains and was down by 0.1%.
Gold prices inched up while crude oil prices were pressured by Tuesdays news of a surprise US stock build.
Coming up over the rest of Wednesday we have UK Consumer Price Index Data, while European Central Bank President Mario Draghi is scheduled to speak in Berlin.
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--- Written by David Cottle, DailyFX Research
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