Asian Market Update – Thursday: Bitcoin Rallies to $7,200; Asian Stocks Rebound in Cautious Trading
The Big Question: Is the US tax reform falling apart?
Prices of main cryptocurrencies pointed slightly lower during early morning trading on Thursday, with bitcoin and ethereum prices falling slightly and litecoin posting minor gains.
Bitcoin dropped 0.8 percent to $7,235 shortly after midday in Asia. This followed a strong upswing on Wednesday that lifted the cryptocurrency’s price above $7,000 for the first time since Friday.
The price of ethereum was down 1 percent to about $330 before midday in Asia. The loss in the past two days erased part of the gains made on Tuesday and brought the virtual currency back to the same level seen yesterday morning.
Litecoin added a slight 0.22 percent to $63.58 at midday. The price of litecoin is now trading close to short-term resistance around $65 in the upper end of its trading range. Short-term traders could wait for price to fall back to the $57-$60 level before considering a buy.
Recent turmoil in Zimbabwe could prove to be a boon to bitcoin price. As CCN reported yesterday, an apparent military coup in Zimbabwe could send the bitcoin price even higher in that country’s domestic exchanges.
The Zimbabwe military on Wednesday entered the country’s capital and seized the state broadcaster and other government offices, in an apparent opposition to long-time ruler Robert Mugabe. The country is in the midst of a financial crisis, where cash is hard to come by and hard assets have been in high demand, but cryptocurrencies have begun to eat into gold’s market share in the country.
Also in the news: bitcoin mining is not banned, at least for now, in China, after news reports this week suggested that the country did ban bitcoin mining in its Southwest province of Sichuan.
Main Market Movers – Mid-day Asian Trading Session
|Indexes||Value at Midday||Daily Change|
|Japan- Nikkei 225||22,187||0.72%|
|China-Shanghai Composite Index||3,400||-0.07%|
|Hong Kong –Hang Seng||28,957||0.38%|
|S&P 500 E-Mini Futures||2,568||-0.15%|
Most major Asian equities markets were showing signs of recovery from losses on Wednesday, but gains were small and the Chinese Mainland remains in red.
In Japan, the Nikkei 225 was up 0.72 percent to 22, 187 at midday on Thursday, erasing losses on Wednesday and bringing the index back to the same level as midday Wednesday.
On the Chinese mainland, the Shanghai Composite Index was down 0.07 percent to about 3,400 before midday. In Hong Kong, the Hang Seng Index gained 0.38 percent to around 28,957 before midday.
Talks of a slowing Chinese economy continues to send chill waves across the markets after disappointing industrial output and retail data for October.
In South Korea, the Kospi added 0.25 percent to around 2,532 shortly before midday.
Down under, the ASX 200 was up 0.16 percent to 5,943.
The S&P 500 E-Mini Futures was down 0.15 percent to 2,568 at midday.
A renewed prospect of US tax reform has turned to grim after two Republican lawmakers voiced opposition to the two versions – one from the House of Representatives and another from the Senate. Democratic lawmakers also said they would not vote for the reform plan. Markets have been enjoying high hopes for the reform plans that are welcome on Wall Street.
The Republican lawmakers’ criticism of the tax reform plan came after the leadership appeared to try to include a bill to repeal Obamacare into the tax bill and handle the two key issues at once.
The Japanese yen skidded 0.07 percent the US dollar at midday Thursday to 112.955 per dollar.
The Chinese yuan lost 0.22 percent against the US dollar at 6.6341 per dollar.
The Australian dollar firmed 0.21 percent on the dollar, changing hands at 1.3148 per dollar at midday.
WTI Oil was up 0.07 percent to $55.32 per barrel.
Brent Crude gained 0.06 percent to $61.91 per barrel.
Gold was up 0.06 percent to $1,278 an ounce.
Business News across Asia
In China, South Korean electronics giant Samsung is expanding its factory in Xi’an in Northwest China to build a global semiconductor base. Construction of the second phase of the memory chip facility has started, as reported by Chinese newspaper Global Times.
Take away: Though Samsung has been struggling in stiff competition with Apple and others, the South Korea firm appears to enjoy a strong position in the Chinese market.
In the Philippines, economic growth remains robust in the third quarter of 2017, beating expectations. The Philippine economy grew by 6.9 percent from a year earlier, the country’s statistics agency said on Thursday, beating a Reuters forecast of 6.5 percent growth.
Take away: The Philippines is one of the fastest-growing economies in Asia, but its stagnant wage growth has many in the country still in poverty. Still, it remains one of the best prospects for investing in South East Asia.
Fatured image from Pixabay.