Monday, 4 September 2017

Asian stocks under pressure; gold and yen on high demand

Posted by Valentine at 11:12 Labels:

Asian stock indexes were under pressure on Monday, as renewed geopolitical tensions weighed on market sentiment, pushing investors to safe haven assets such as gold and the yen.

Early hours on Sunday, the North Korean tested their most powerful weapon to date, an hydrogen bomb atop a large-range intercontinental ballistic missile.

This action from Kim Jong-un’s government comes in response to a series of joint military drills between the US and South Korea.

President Donald Trump said there are many options on the table to deal with North Korea, including the suspension of trade with nations holding ties to the communist country.

In the light of this event, an emergency meeting of the United Nations Security Council was requested by South Korea, the US, Japan, France and the United Kingdom.

Australia ASX -22.30 -0.39% 5,763.80 07:20 GMT - CLOSED
Shanghai Composite +12.46 +0.37% 3,379.58 07:20 GMT - CLOSED
Hang Seng Index -254.13 -0.91% 27,699.03 07:20 GMT - OPEN
Nikkei 225 -183.22 -0.93% 19,508.25 07:20 GMT - CLOSED
TSEC 50 Index -24.95 -0.24% 10,569.87 07:20 GMT - CLOSED

Last week, Asian markets ended in green territory, with manufacturing data from China cheering investors, as well as a key inflation index in the United States.

China’s private Caixin manufacturing PMI index came in at 51.6, outperforming a previous reading of 51.1 and a forecasted value of 50.9. This result suggests that the world’s second-largest economy remains on track for expansion.

Previously, the US core PCE price index, Fed’s favourite inflation measure, met expectations with a year-over-year rate of 1.4 percent a monthly rate of 0.1 percent.

Japan's Nikkei 225 added 0.23 percent to end at 19,691.47, while the Kospi finished to the downside by 0.23 percent at 2,357.69. Australian S&P/ASX 200 posted a 0.18 percent gain to 5,724.6, boosted by Chinese economic data.

Hong Kong's Hang Seng Index eased a modest 0.02 percent to 27,963.6 and the Shanghai Composite rose 0.19 percent to close at 3,367.3004.

The Shenzhen Composite increased by 0.587 percent to end the week at 1,956.3525. Stock markets in Singapore, Indonesia, Philippines and Malaysia were closed for a holiday.

The American session on Friday presented a set of mixed statistics, such as a downshifting employment report and an upbeat manufacturing index.

The US Labor Department said average hourly earnings rose 0.1 percent in August, less than an originally estimated 0.2 percent build. According to data, the country added 156,000 jobs, compared to an expected 180,000 addition. The unemployment rate ticked up to 4.4 percent.

In a separate report, the Institute for Supply Management said its manufacturing PMI index moved to 58.8, above expectations for a 56.5 reading.

Key economic events for Monday, 4 September 2017:

ALL DAY US Labor Day
08:30 GMT UK Construction PMI (Aug) Forecast: 52.0
23:00 GMT UK BRC Retail Sales Monitor (YoY) (Aug) Previous: 0.9%

Fort Financial Services

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