City A.M. TV: Daily market snapshot (video)
Is there a message for western markets from Asian price action? Various key Asian markets, including the Chinese Shanghai Composite, Hong Kong’s Hang Seng and Korea’s Kospi, have all struggled to break above key technical levels in recent trading sessions.
That stands in contrast the price action in the US (at new highs) and Germany’s DAX (testing new highs). Which is correct is critical for determining what stage globally markets are it in this latest pullback (and, therefore, where they go next). Is the pullback over? Was it a ‘one wave’ short lived affair? Or is wave three of the pullback about to commence? In addition, what’s the message of the short term market timing models?
Various key themes are likely to dominate markets this week: Biden’s stimulus proposal is expected to make further progress (after good progress last week); China and the US publish key inflation data later this week (Wednesday) while the UK’s Q4 GDP data will be watched closely; corporate earnings in the US & Europe continue this week – in the Euro zone there’s a focus on financial/bank companies reporting; while various key central bankers are hitting the stumps this week including the Bank of England’s Governor Andrew Bailey (giving his key Mansion House speech) as well as Jerome Powell speaking at the Economic Club of NY and ECB President Lagarde. Chinese New Year celebrations also start later this week.