Chinese Shares Rip And Dollar Dips
London Capital Group | Jul 06, 2020 10:12
“The policy of being too cautious is the greatest risk of all.” – Jawaharlal Nehruh2 Shares/h2
Chinese shares are shooting higher on optimism around the economic reopening and policy stimulus in China. The CSI 300 has added 5% on top of the 5-year high reached Friday. Shares in Hong Kong have reversed the entire March decline.
European markets have opened higher, bolstered by a return to growth in Germany factory orders, albeit at a slower pace than expected.
Cyclical shares are leading the rally on the FTSE 100 with homebuilders and banks leading the way. That includes Lloyds (LON:LLOY) where CEO Antonio Horta-Osario announced he will step down.
h3 Forex/h3The Chinese yuan is getting a lift alongside Chinese equities. USD/CNH is trading on a 7.03 handle at its lowest level in 3 ½ months.
The US dollar is almost universally lower since the strong payrolls surprise on Thursday kept hopes for the global economic revival alive.
AUD/USD is again testing 0.70 – with investors brushing off the re-closed borders in the Australian state of Victoria.
h3 Commodities/h3Gold is steady with the spot price near $1770 per oz and futures close to $1800. Precious metals are laying low amid the rally Chinese equities but the price is stable thanks to the weakness in the US dollar.
Oil prices are chasing equities higher on the same optimism that the economic recovery will expand demand for fuel. Both Brent and WTI futures have topped their June peaks to be at the highest levels since the Russia-Saudi price war in March.
h3 Chart/h3The Shanghai Composite index is breaking out to the topside of a long term triangle pattern. It appears a long term bottom has been established at 2650 support.
Original Post
Get The App
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.