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Asia Pacific market correction: positive news fades, data uncertainty added, investor sentiment turns cautious
forex7 months before
Summary：On Thursday (May 15th), the Asia Pacific stock markets generally fell, and the US dollar weakened. The market's response to earlier positive news gradually cooled down, and investors turned their attention to the upcoming US economic data and Federal Reserve speech, seeking new market direction guidance. The US budget, falling oil prices, and trade policy uncertainty have led to a cautious market atmosphere.
On Thursday (May 15th), major stock indices in the Asia Pacific region weakened and the US dollar exchange rate fell. The positive factors that previously drove the market to strengthen, such as the suspension of the US China trade war and the Middle East investment agreement, have been largely digested by the market. Investors are returning to a wait-and-see attitude, paying attention to the upcoming speech by Federal Reserve Chairman Powell and key US data.
The MSCI Asia Pacific (excluding Japan) index fell 0.15%, while the futures of the three major Wall Street stock indices slightly declined, and the spot market had limited volatility on the day. The Nikkei 225 Index in Japan closed down 0.85%, the Shanghai and Shenzhen 300 Index in China fell 0.63%, and the Hang Seng Index in Hong Kong fell 0.55%.
Before the opening of the European market, major stock index futures also showed signs of fatigue. EURO STOXX 50 futures fell 0.17%, German DAX futures fell 0.23%, and UK FTSE 100 futures remained largely unchanged.
Investment sentiment shifts towards prudence: Previous positive news fades, policy uncertainty still exists | | | Although the preliminary trade settlement between China and the United States and multiple investment cooperation agreements reached during Trump's visit to the Middle East have provided some support for the market, analysts point out that these factors have gradually weakened their driving force on the market.
IG market analyst Tony Sycamore vividly stated, "The market has gone through a lively party before and is now in a period of hangover recovery, waiting for new drivers to emerge." | | He further pointed out that given the lack of clear signals from US President Trump on trade policy, investors remain cautious about the global economic outlook. Previously, trade frictions and policy fluctuations severely undermined investor confidence, and it is currently difficult to determine whether foreign capital will significantly increase its investment in the US stock market. US economic data and Federal Reserve movements have become the focus of attention. The market is currently focused on the upcoming release of US retail sales data and the financial report of retail giant Walmart. These two data points are widely regarded as a barometer of US consumer confidence. If the data falls short of expectations, it may once again raise concerns about a slowdown or even a recession in the US economy.
In addition, the latest speech by Federal Reserve Chairman Powell has also attracted much attention. The market is trying to find signals of future interest rate trends from its wording.
The volatility of the foreign exchange market has intensified, with the Korean won becoming the focus. The US dollar index failed to continue its strong trend at the beginning of this week. It fell 0.55% against the Japanese yen to 145.99, while the euro rose 0.2% against the US dollar to 1.1193.
The Korean won has become the focus of the Asian foreign exchange market, with a sharp fluctuation of over 0.8% against the US dollar, reaching 1395.52. Previously, it was reported that South Korean Deputy Minister of Finance Choi Ji yong held talks with senior officials from the US Treasury Department earlier this month to discuss the stability of the Korean won market. Analysis suggests that this official level dialogue has a phased impact on the exchange rate, with a trend similar to the significant appreciation of the New Taiwan Dollar at the beginning of this month.
Bloomberg reported that the United States has not sought to devalue the US dollar in the current trade negotiations, easing some market tensions. However, investors remain vigilant about potential changes in foreign exchange policies that Washington may adopt in the future.
Goldman Sachs analysts pointed out in their latest report that the current market is refocusing on the appreciation potential of currencies of trade surplus countries against the backdrop of a weakening US dollar, "especially in the context of signs of structural withdrawal of US dollar assets".
The commodity market is under pressure, with both oil prices and gold falling. The commodity market is also under pressure. Due to market expectations that the US and Iran may restart negotiations on the nuclear agreement, crude oil prices have fallen for the second consecutive day. Brent crude oil and WTI crude oil futures both fell more than 2%, wiping out some recent gains.
Spot gold also came under pressure, falling 1.2% and trading around $3140 per ounce.
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