Asian equities could trade on a risk-off tone as global equities negatively in which all major indices dripped lower from the Wall Street open as participants braced for the large-cap tech earnings. Alphabet shares extended on declines after-hours due to earnings miss. Nasdaq closed down almost 4%. The bitter price action could spill to the Asian risk assets.
It is worth keeping a close eye on the top performers amid the recent sell-off, the USD, as the Dollar Index (DXY) is printing a fresh year-to-date high above 102.00. However, JPY outperformed the USD as Japan’s government will aim to stabilise FX moves with economic policy. Volatility has now dominated all asset classes from FX to Bonds, and Oil prices and Natural Gas gained with Russia cutting gas flows to Poland and Bulgaria. Russian media quoted the Russian Ministry of Defence more to the geopolitical theme weighing on price action, stating that ‘London’s direct provocation of Kyiv to strike targets on Russian territory will lead to a proportional response’. Looking ahead, traders will digest the US earnings season price action and watch for any updates on China’s COVID situation, geopolitical tensions and month-end flows. With little tier-one data on the docket, participants tend to look forward and add some positioning for a busy first week in May, where the FOMC will be a major risk event.
© 2019 High Leverage FX - All Rights Reserved.
© 2019 High Leverage FX - All Rights Reserved.