Asian equities might trade positive after recovery of heavy losses seen Friday’s on Wall Street. Although, participants will be paying close attention to any new data around the new Covid variant and further restrictions around the world that could worsen the supply chain crisis. Traders watch that theme as it could become a big issue for global economies and Central Banks amid rising prices and the start of the withdrawal of the Monetary and Fiscal stimulus.
Worth keeping a close eye on the Energy sector and Covid sensitive names for a rebound. Watch the cyclical currencies like AUD, NZD and CAD, as commodities showed a slightly firmer rebound in yesterday’s session. After the steep declines on Friday, the USD regained some ground due to a strong move in the short-term interest rates markets. On the radar for today, traders will be monitoring Central Bankers commentary over the new Covid variant, the Fed Chair Powell said early today that the rise in COVID cases and the Omicron variant pose downside risks to employment and increased uncertainty for inflation. Aside from the recent Covid worries, traders will be playing around with the liquidity for the last day of the month and working some positions for the heavy data calendar in the coming days and weeks. Today, the highlight will be the Chinese official PMIs, which could help the local and global players measure how the second-biggest economy is performing amid its economic recovery during the pandemic.
