Friday 12th July: Asian markets edge up as Singapore flirts with recession

Global Markets:

• Asian Stock Markets : Nikkei up 0.20%, Shanghai Composite up 0.53%, Hang Seng up 0.22%, ASX down 0.29%
• Commodities : Gold at $1408.55 (+0.13%), Silver at $15.15 (+0.04%), Brent Oil at $67.00 (+0.72%), WTI Oil at $60.60 (+0.66%)
• Rates : US 10-year yield at 2.127, UK 10-year yield at 0.837, Germany 10-year yield at -0.253

News & Data:

• (NZD) Business NZ Manufacturing Index 51.3 vs 50.4 previous
• (USD) Core CPI m/m 0.30% vs 0.20% expected
• (USD) CPI m/m 0.10% vs 0.00% expected
• PBoC Fixes USDCNY Ref Rate At 6.8662
• Two Fed Regional Chiefs Say a July Rate Cut May Not Be Warranted

Markets Update:

Asian stock markets are edging up om Friday amid renewed worries about U.S.-China trade tensions and on caution ahead of the release of China’s trade date for June later today. U.S. President Donald Trump has accused China of not increasing its purchase of American farm products despite its promise to do so.

Investors are cautious as they looked ahead to the release of Chinese trade data for June later today, to assess the impact of Beijing’s ongoing trade war with Washington. Meanwhile, data showed Singapore’s economy shrinking much more than expected in the second quarter.

Mainland Chinese stocks recovered from their earlier slip to rise by the morning session’s end, with the Shanghai composite up 0.5% and the Shenzhen composite 0.8% higher. Despite the poorer-than-expected data print, Singapore’s markets recovered from their earlier slip, with the Straits Times Index trading 0.2% higher in the morning. Hong Kong’s Hang Seng index also added 0.2%. The Nikkei 225 in Japan traded up by 0.2%, while the Topix index fell 0.2%.

U.S. Treasury yields had jumped on Thursday after demand was weak for a $16 billion 30-year bond auction and after the U.S. Labor Department said its consumer price index excluding food and energy rose 0.3% in June, the biggest increase since January 2018. The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 96.933 after touching an earlier high of 97.116

Oil prices picked up as U.S. oil producers in the Gulf of Mexico cut by output by more than half, in the face of a tropical storm and as tensions in the Middle East remained. Gold prices, dulled by the stronger-than-expected U.S. consumer inflation data, regained their shine thanks to renewed trade worries and rate cut expectations.

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