Asian equities could trade positively as global peers traded in a risk-on mood across the board, with the cyclical sector outperforming after a pullback in US yields and the USD. Although some headwinds could be seen in the tech sector as Alphabet and Microsoft fell post-earnings amid weaker guidance and poor results due to a weakening global economy.
Weakening revenue and sales guidance from US companies could also support the Fed pivot theme by some market participants who yearn to buy the dips. The potential risk-taking flows could surge on Chinese equities, which could be considered the cheapest due to the recent drop. Investors will position for large-cap tech earnings later today, with Apple, Amazon, Intel and others set to report. After the poor figures released yesterday, some emphasis may also be placed on US New Home Sales data, supporting a soft Fed rate policy forward.
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© 2019 High Leverage FX - All Rights Reserved.