Sydney (Reuters)-Asian stocks Monday while oil and euro pressures as talks about the revival of COVID-19 regulations in Europe and a sharp drop from the US Federal Reserve warned investors I got off to a soft start this week.
Oil futures fell about 1% in the open, hitting seven-week lows of $ 78.05 and $ 74.76, respectively, amid concerns over oversupply.
Australian stocks fell 0.4%, driven by bank stock losses. With a 0.3% drop, MSCI’s widest index for Asia Pacific equities was flat.
“There is a question mark on the resilience of Europe and the European economy, exacerbated by the protests and infection rates seen over the weekend,” said Rodrigo Catril, a strategist at Sydney’s National Australia Bank (OTC :).
“It’s hard to see the US dollar harming such a background,” he said, a view further highlighted by recent strong US data and hawkish remarks from Fed officials.
The euro fell 0.2% to $ 1.1280, approaching its 16-month low. Common currencies have been the driving force of the market in recent sessions as investors are betting on the European economy, which is far behind the recovery of the United States.
Safe assets such as bonds, gold and yen have also benefited from the cautious attitude of recent financial markets.
Yields on 10-year Benchmark Treasuries on Monday were stable at 1.5634%. Gold found support for $ 1,845 per ounce. The yen remained at 114.09 yen per dollar.
The risk-sensitive Australian dollar also fell to a low of $ 0.7227 in seven weeks. South Korean stocks were outliers as chip makers chased US peers with a bright outlook for memory chip demand.
It rose 0.2% after the Wall Street index fell on Friday.
This week, US Thanksgiving could reduce trading, but in a cautious tone, traders are once again monitoring COVID-19 cases in Europe, keeping an eye out for central bank speakers, especially in the UK and Europe. increase.
Austria began its fourth blockade on Monday, warning that neighboring Germany could follow suit as protests against restrictions broke out across the continent.
Scheduled surveys in Europe and the United Kingdom throughout the week are expected to show a declining trend in production and emotions.
“The combination of COVID, growth and geopolitical concerns in the euro area helps play in a safe place,” said Jane Foley, head of FX strategy at Rabobank.
“The recent break below the $ 1.15 level and the subsequent depreciation have forced us to further lower our forecasts for currency pairs,” she added, expecting it to be around $ 1.12 by mid-next year.
Meanwhile, the US economy has surprised analysts as retail sales data for the past few weeks have exceeded expectations and inflation is high. This week’s focus is on prices and the labor market, and what the Fed could do about its strength.
Richard Clarida, Vice-Chairman of the Federal Reserve Board, said last week that accelerating the tapering pace may be worth discussing at the December meeting. The Federal Reserve Board is scheduled for Wednesday.
As expected, China maintained benchmark lending rates for corporate and household loans for 19 months on Monday.
Central banks in South Korea and New Zealand are expected to raise interest rates this week, and the swap market is priced in New Zealand with a 40% chance of raising interest rates by 50 basis points.
After posting the worst week in the last two months, I was under pressure and ended up at $ 58,180.
Oil and Euro Slip, Reuters European COVID-19 Curb Market
https://www.investing.com/news/economy/oil-and-euro-slip-markets-on-edge-over-covid19-curbs-in-europe-2686370 Oil and Euro Slip, Reuters European COVID-19 Curb Market