Asia Markets
Asia took a queue from U.S. market weakness and opened lower this morning. But after opening down, the market quickly stabilised and rebounded. Despite a slew of macro data with U.S. ISM PMI and Nonfarm Payrolls in focus, there has been little follow-through de-risking in Asia as the trade headline damage has seemingly run its course for now.
China PMI
Providing a bit of oxygen to an overly exhausted market China's October Caixin Manufacturing PMI showed the most significant improvement in operating conditions for manufacturers since February 2017. Both output and new orders grew at steeper rates, with the latter supported by a renewed increase in export business. Companies could thus increase their purchasing activity at the fastest pace in 20 months. Suggesting the PBoC targeted LPR stimulus efforts are indeed getting money into the hands of domestic companies that need it the most
Oil Markets
Oil has stabilised throughout the morning session, but where local traders have shown some willingness to buy Asia dips this week, it's a been a quieter today on that side of the street with the key U.S. ISM PMI looming which could provide another downshift to sentiment. No point being a hero as the sun will always come up tomorrow.
Gold Market
Gold has been hugging the $1510 region supported by the US trade uncertainty, but the market has been lightening up on gold after the better than expected China Caixin PMI. Flow wise it hasn't been that busy, but if Gold markets can hold above $1510 for a significant duration or break above $1525, we could see a pickup in actions.
I still favour trading gold from the long position as a buyer on dips as the September tariffs have yet to filter through the US economy completely.
Currency Markets
I'm entirely flat currency markets which means I don't have a view. But frankly, I think this is the right way to be now at least until we get through this next series of US macro data and hear what Vice-Chair Clarida has to say about the state of the US economy later in the New York season.