Asia equities are trading moderately after the losses on Wall Street, where cyclical and financial sectors were hit as US Treasury yields dipped post-Consumer Price Index data. Worth noting that some downside could also be explained by technical plays ahead of the Quadruple Witching day on Friday.
In the commodity space, Oil prices settled flat in choppy trade amid the downbeat risk tone, China Strategic Petroleum Reserve sales, increased Russian production, and International Energy Agency demand forecast downgrades. As China’s activity slowdown is causing some worries across Emerging Economies, Chile expects decreasing copper demand from China, citing slower economic growth and reserve selling in China, and it lowers the 2021 average price forecast to USD 4.20/lb from USD 4.30/lb.
On the China front, the notable crackdown continues as local media reports that China is to launch targeted measures for small exporters. The crypto and related names could take a hit as reports suggest that China’s Hebei province is cracking down on crypto mining. For the session ahead, traders digest disappointing Japanese Machinery Orders and assimilate the Chinese activity report. The data will enable participants to measure the size of the hit delivered by constraints imposed in several Chinese provinces in response to the outbreak of the Covid-19 Delta variant.
