Market Commentary on the Last Day of the Quarter

Market Commentary on the Last Day of the Quarter

On the last trading day of the ongoing quarter, the Asian markets fell as investors balanced their positions. The positive U.S. economic growth data led to rising in the dollar. The Dollar index was higher, but on a quarterly basis, it is poised for a loss. Euro was flat suggesting that Europe growth story is steaming out.

The European markets had a muted start as expected and moved further lower during mid-morning deals. The investors were still digesting the new EU guidelines to a potential Brexit deal. The markets were also reacting to a cabinet reshuffle happening in South Africa. The speculation about cabinet reshuffling was rocking the country’s markets and currency for days. Finally, the President Jacob Zuma sacked both the finance and deputy finance ministers and replaced them with new faces. The South African rand dropped to a two-month low after this reshuffle.

Britain’s FTSE 100.FTSE was trading at 0.41% lower, France’s CAC was down by 0.16 percent and Germany’s DAX was almost flat at 12259.08 just 2.65 points or 0.02% up.

Hong Kong .HSI index ended the day lower by 0.6 percent, but on a quarterly basis, it is headed for a 9.8 percent jump. China’s CSI 300 index.CSI300 too added 4.2 percent on the quarterly basis and ended the day 0.4 percent up. Beating all analysts’ expectations, China’s manufacturing sector activity was at its fastest pace in this month when compared to the pace in the last 5 years.

The global investment analyst, James Woods working at Rivkin Securities in Sydney said, “Asia saw some pretty healthy profit-taking after a few sessions of solid gains, and as investors await Eurozone and U.S. inflation data tonight.

The U.S. President Donald Trump has a meeting scheduled with his Chinese counterpart President Xi Jinping next week. The tweet by Trump that the U.S. could no longer tolerate massive trade deficits and job losses has already foreshadowed it.

A top official in the Trump administration also said,  “President is to sign executive orders on Friday that are aimed at identifying abuses that are causing the deficits and clamping down on non-payment of anti-dumping and anti-subsidy duties on imports.”

Zheng Zeguang, the Chinese Vice Foreign Minister, on the other hand, clarified that his country does not follow any policy that devalues its currency to promote exports. He also said China does not seek a trade surplus with the US.

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