Asian Market Update

Daily Forex Fundamentals | Written by Trade The News | Sep 01 09 05:19 GMT |

Asian stocks advance as Chinese manufacturing data continues to expand As expected, the RBA left interest unchanged at 3%. In its accompanying statement, the central bank said that the current policy is appropriate for the time being. Following the comments from the RBA, the AUD moved into negative territory, as markets continue to seek guidance as to when the RBA will begin hiking rates. China's Aug PMI manufacturing rose to 54.0 from 53.3, which was the highest level since April 2008. The PMI data was driven by increases in output and new orders. The Chinese official PMI data, was confirmed by the Aug CLSA PMI manufacturing data, which rose to 55.1 from 52.8. In terms of Australian economic data, the Aug AIG performance of manufacturing index rose to 51.7, which was the highest level since April 2008. Australia's Q2 current account deficit was worse than market expectations, as net exports subtracted 0.2 percentage points from Q2 GDP (AUSTRALIA Q2 CURRENT ACCOUNT BALANCE (A$): -13.3B V -10.7BE;). Australia's Q2 GDP data is due on tomorrow's session. In other Australian data, July building approvals were better than expected, adding to the signs of recovery in the country's property market. In the currency markets, the USD dollar is weaker against the European major and commodity currencies. However, the AUD/USD is trading lower following comments from the RBA. The Japanese yen is gaining against the USD and AUD, but weaker against the EUR, GBP, CHF, CAD and NZD. In equities, the Nikkei 225 is higher by more than 0.30% on gains in shares of telecom and oil/gas companies. At the time of writing, the Shanghai Composite is higher by more than 0.50%, led by telecoms and financials. However, Chinese basic materials companies are trading lower. Australia's S&P ASX 200 is higher by more than 0.50%, led by retailers. Taiwan's Taiex is gaining by more than 2%, led by industrial and technology names. The Kospi has advanced by more than 0.70% on gains in shares of health care and consumer goods companies. Hong Kong's Hang Seng is higher by more than 0.25%, tracking the equity gains in China. Crude oil prices are higher and trading above $70/bbl, after declining by more than 3% in NY floor trading. Crude prices have been supported by the Chinese PMI data and gains in equities. Looking ahead, oil prices may receive some direction from upcoming US ISM manufacturing data and weekly API inventories. Spot Gold is higher by more than $2, after declining by more than $5 on the COMEX. The Friday release of US nonfarm payrolls data, is seen as a key event risk for gold prices. (Note: All quotes are as of 01:11 EST). Trade The News Staff Trade The News, Inc. Legal disclaimer and risk disclosure All information provided by Trade The News (a product of Trade The News, Inc. "referred to as TTN hereafter") is for informational purposes only. Information provided is not meant as investment advice nor is it a recommendation to Buy or Sell securities. Although information is taken from sources deemed reliable, no guarantees or assurances can be made to the accuracy of any information provided. 1. Information can be inaccurate and/or incomplete 2. Information can be mistakenly re-released or be delayed, 3. Information may be incorrect, misread, misinterpreted or misunderstood 4. Human error is a business risk you are willing to assume 5. Technology can crash or be interrupted without notice 6. Trading decisions are the responsibility of traders, not those providing additional information. Trade The News is not liable (financial and/or non-financial) for any losses that may arise from any information provided by TTN. Trading securities involves a high degree of risk, and financial losses can and do occur on a regular basis and are part of the risk of trading and investing.