Asian markets under pressure ahead of Chinese Q1 GDP data

Monday, April 14, 2014

Asian equities started the week on the back foot, carrying over the weaker market sentiment that dominated US trading on Friday. Most major benchmark indices in the region ended the session in negative territory ahead of key economic data due out later this week as investors opted to remain side-lined amid the recent market rout which has seen the S&P 500 drop to a two month low. Market participants will be paying close attention to Chinese economic data, with all eyes on the release of Q1 GDP growth on Wednesday as well as March retail sales and industrial production due out the same day.

US markets slumped towards the end of last week as disappointing corporate earnings sparked valuation concerns among investors. The S&P 500 shed 3% throughout Thursday and Friday while the DJIA erased 2.5% during the same period. JPMorgan posted a sharp decline in earnings with Q1 net income falling to $5.27bn from $6.53bn during the same quarter last year citing tougher trading conditions. With Citigroup scheduled to released earnings later today and notable releases from Johnson & Johnson, Coca Cola, Intel, Bank of America and Google in the coming days, investors will be paying close attention to any earning missteps which could see equity markets trade with continued volatility.

Spot gold prices extended gains early on this morning, after consolidating around the 50 day MA on Friday as risk aversion prompted investors to seek out safety. Details from the FOMC minutes as well as a shaky start to earnings season has caught the bears off guard as the Fed minutes played down a sooner than expected rates rise and the tentative economic backdrop added fuel to the fire. Prices have built on support at the 50 day MA this morning and are now testing tentative resistance around $1,330/oz.

Three month LME nickel prices extended gains as an impulsive rally over the past three sessions and a strong early morning buying activity today pushes the metal above $17,800/tonne for the first time since March last year. Nickel prices have rallied almost 12% since the start of the month and almost 30% since the start of the year as a combination of the Indonesian export ban and rising tensions between the West and Russia threaten supply.  

S&P 500 faced a sharp sell-off towards the end of last week

SPX Index SP 500 Index Daily 2014 04 14 07 38 51

Spot gold prices rally on equity market valuation concerns

XAU Curncy Gold Spot Oz 2014 04 14 07 46 20

Three month LME nickel prices extend gains early on this morning

LMNIDS03 Comdty LME NICKEL 3 2014 04 14 07 51 26

Events for today 

1000

EZ

Feb

Industrial Production

1330

US

Mar

Retail Sales

1500

US

Feb

Business Inventories

 

 

Topics: GDP, Equities, Gold, LME, Nickel
More from: Kash Kamal