Asia bourses are trading lower as the region takes its hint from the dim trade across global peers amid lingering growth peak concerns and US-China tensions. Newswires reports that the United States is planning to inflict sanctions today on several Chinese officials over Beijing’s crackdown on democracy in Hong Kong, as well as a warning to international businesses operating there about worsening conditions. Yesterday, German Chancellor Angela Merkel said she wants a level playing field in trade with China. There is an understanding with the U.S. that China is a competitor, adding substantial security concerns remain in the relationship with China.
On Wall Street, yesterday’s traders went for a defensive play. From a global macro perspective, it was equities down, bonds up, oil down, dollar up. Asian traders will be paying attention to oil on the commodity front as it slid to a four-week low amid the dollar strengthening, and on OPEC’s signal, it may raise output soon. According to a Chinese Research, China’s record demand for imported pork is about to crater after onshore prices plunged, probably alleviating pressure on the world meat market and reducing at least one part of global food costs. In the coming months, this could relieve some stress on the inflation readings and ease some recent concerns over rising commodities that made Beijing’s officials intervene in the markets with its reserves and rhetoric to sustain prices.
