Asian equities could trade lower following a risk-off day on Wall Street. Although cyclical sectors in China could get some attention as the economic outlook is being revised to the upside by investors. As a reference, Oil traded mostly higher due to a draw in the US oil inventory. Helping the price action was a better outlook for China’s oil demand as the reopening of the economy is faster than expected.
A soft Dollar could also help with some flows to risk assets. On the monetary policy front, today, traders will be eying the PBoC LPR fixing, which is expected to be unchanged. If the PBoC surprises and cuts the rates, equities could be supportive as more easing is seen as good for supporting China’s economic growth. Looking ahead, today’s session is the last day that the FOMC members can discuss policy as they enter the blackout period before the FOMC decision. It is also option expiry day in the US, so technical trades will be seen across multiple asset classes.