Asian Market Update – Thursday: Asian Markets Brush Off Trump Threats of Shutting Down US Government, Pulling From NAFTA | Hacked: Hacking Finance
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Asian Market Update – Thursday: Asian Markets Brush Off Trump Threats of Shutting Down US Government, Pulling From NAFTA

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Asian Market Update – Thursday: Asian Markets Brush Off Trump Threats of Shutting Down US Government, Pulling From NAFTA

Introduction

This article was posted on Thursday, 10:00, UTC.

The Big Question: Have Asian markets gotten used to Trump comments that would normally lead to market crash?

Also read: Trump Talks Up Border Wall as Congress Eyes Sept. 30 Budget Deadline

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Major equity markets in the Asia Pacific on Thursday brushed off a speech by US President Donald Trump that is full of risks that investors tend to avoid from a government closure in the US to withdrawal from a major trade deal.

Most major indexes in Asia Pacific were up in early trading, while the stock markets in Tokyo and Shanghai were down just slightly.

The Hong Kong Hang Seng Index edged up 0.37 percent to 27,485.87, though the gain was trimmed down from earlier in the morning when the index was slightly above the 27,600 levels.

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The Hong Kong Stock Exchange resumed trading on Thursday, after it was suspended on Wednesday due to a severe typhoon. There has been no reports so far as to how the halt impacted the market, but the gain on Thursday suggest investors were happy back at it.

In South Korea, the KOSPI Index was up 0.41 percent at 2,376.06. The gain came after the rogue leader in North Korea ordered on Wednesday its nuclear forces get ready for war any time.

Down under, the ASX 200 gained a modest 0.07 percent to 5,741 before midday.

In Japan, the Nikkei dropped about 0.35 percent to 19,368 before midday after it shot up higher in early hours of the Asian trading session.

In China, the Shanghai Composite Index was down 0.17 percent to 3,282.

The mixed performance, with most major Asian indexes up, suggests that investors in Asia did not really care too much about what Trump said or at least they didn’t let it affect their decisions.

During a speech in Phoenix, Arizona, Trump causally mentioned that he is willing to shut down the US government to get funds for a border wall between the US and Mexico and said that he will “probably” end up terminating the North America Free Trade Agreement.

Any of these comments, had it come from another more serious president, would have led to a catastrophe in markets not just in the US, but across the globe.

Here is what to watch out for: Let’s face it, not many people take Trump’s threats too seriously anymore, but the comments could exacerbate domestic political turmoil even within Trump’s Republican Party. This is important because the US lawmakers and Trump need to agree on a budget before the end of September to keep the US government open and negotiate a deal on raising the debt ceiling to keep the US from default. Watch how lawmakers respond to Trump’s comments.

Main Market Movers – Midday Asian Trading Session

Indexes Value at Midday Daily Change
Japan-Nikkei Stock Average 225 1,9368 -0.35%
China-Shanghai Composite Index 3,282 -0.17%
Australia-ASX 200 5741 0.07%
India-Mumbai Sensex 31,575 0.03%

Cryptocurrencies

Meanwhile, in the world of virtual currencies, trading seemed to be quite stable during the Asian trading session, with Bitcoin and Ethereum both down just slightly.

Bitcoin was down 0.12 percent before midday, trading at around $4100.

Ethereum was trading at around $315, down 0.31 percent.

Currencies

The Japanese yen dropped a slight 0.14 percent against the US dollar at Midday on Wednesday. The JPY/USD rate was at 0.009163.

The Chinese yuan remains unchanged against the dollar.

The Australian dollar is slightly down against the US dollar. AUD/USD was trading at 0.78990, down 0.05%.

Commodities

WTI Oil is unchanged for the day, trading at $48.35 per barrel.

Brent Crude gained 0.10 percent to $52.55 per barrel

Gold was down 0.08 percent to $1,289.38 an ounce

Business News across Asia

In China, top government officials have come out to reaffirm their support for Chinese company’s that invest overseas, after reports of China further cracking down on what officials believe to be “irrational investments.” China’s Ministry of Commerce on Thursday said it supports companies that want to expand overseas and ensure the process will be “stable and long-term.”

Though the government has repeatedly said it supports capable companies to investment in overseas assets, it has kept a tight leash on certain deals, including real estate, entertainment and sports teams in the US.

Take away: Those who worry about China buying up everything in their country can relax a bit, as the Chinese government is now keeping a close eye on this to ensure more capital stays within the country.

In Japan, traders are to a large extent keeping their eyes on the upcoming Fed meeting in Jackson Hole, Wyoming on Friday.

Take Away: In lack of major economic news out of Japan, the Jackson Hole meeting will be the dominant force driving both the JPYUSD rate and Japanese equities.

Important: Never invest money you can't afford to lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here.



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Fredrik Vold

Fredrik Vold

Fredrik Vold is an entrepreneur, financial writer, and technical analysis enthusiast. He has been working and traveling in Asia for several years, and is currently based out of Beijing, China. He mainly follows the stock and forex markets, and is always looking for the next great alternative investment opportunity.

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