ASEAN Market Preview

ASEAN Market Preview

China’s main indexes fell for their fourth straight session on Wednesday, as investor worries deepened that tighter regulations against speculation and shadow banking will hurt the country’s credit-fuelled recovery.

The blue-chip CSI300 index fell 0.5 percent to 3,445.88 points, while the Shanghai Composite Index lost 0.8 percent to 3,170.69 points.

Small-caps stocks, in particular start-ups, fared poorly with the ChiNext index closing at a three-month low.

Analysts attributed the recent market weakness to worries that China’s stimulus-driven recovery since late last year is fading amid the government’s renewed campaign against excessive leverage and asset bubbles.

With Wall Street near record levels and worries over President Donald Trump’s ability to carry out his pro-growth promises, investors are hoping first-quarter earnings will be strong enough to justify pricey market valuations.

Escalating tensions between the United States and North Korea kept investors nervous, while eyes were also on Europe where sterling surged after British Prime Minister Theresa May called an early general election for June 8, seeking to strengthen her party’s majority ahead of Brexit negotiations..

ASEAN Markets are feeling the pressure, yesterday ASEAN finished lower and the falls may continue today following falls in Oil and on Wall Street.

The U.S. economy expanded at a modest-to-moderate pace between mid-February and the end of March, but inflation pressures remained in check despite more difficulties in attracting and retaining workers, the Federal Reserve said.

Advancing issues outnumbered declining ones on the NYSE by a 1.16-to-1 ratio; on Nasdaq, a 1.83-to-1 ratio favored advancers.

The dollar index, which measures the greenback against a basket of six major currencies, was up 0.26 percent at 99.757. It fell to a low of 99.465, its lowest since March 28, on Tuesday.

The euro reached a near-three-week high against the dollar on Tuesday, but with the first round of France’s presidential election just four days away and polls showing just a few percentage points separating the top four candidates, analysts said gains in the euro would be capped.

Meanwhile, sterling edged lower after rising to a six-and-a-half month high against the dollar on Tuesday, after British Prime Minister Theresa May called a snap election for June, saying it would strengthen Britain’s hand in negotiations with the EU. Sterling was down 0.19 percent at $1.2811.

The Aussie AUD=, the Canadian dollar CAD= and the New Zealand dollar NZD= slipped against the greenback because of weakness in commodity markets.

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S. Jack Heffernan Ph.D. Funds Manager at HEFFX holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.

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