Dow Jones Retreats amid Development Issues, Cling Seng Opens Larger

DOW JONES, HANG SENG INDEX, ASX 200 INDEX OUTLOOK:

• Dow Jones, S&P 500 and Nasdaq 100 indexes closed -0.30%, -0.09% and +0.16% respectively
• Cyclical sectors pulled again amid rising viral issues and falling power costs. The DXY US Greenback index climbed to a two-week excessive following a robust NFP
• Futures throughout the APAC markets are positioned to open mildly larger

Dow, NFP, Crude Oil, USD, Asia-Pacific at Open:

The Dow Jones Industrial Common pulled again from all-time highs on Monday as traders mulled rising Delta variant circumstances around the globe and a doable sooner tempo of Fed tapering stimulus. A lot stronger-than-expected July nonfarm payrolls knowledge pointed to a resilient US labor market regardless of a viral resurgence, hinting that the situations are step by step maturing for Fed officers to start out a debate on a tapering schedule. The abrupt plunge in gold costs throughout Monday’s Asia-Pacific hours might have mirrored this prospect.

WTI crude oil costs fell to a three-week low of $67.00, pulling the power sector (-1.67%) decrease. Defensive-oriented shopper staples (+0.38%) outperformed, pointing to a cautious begin for APAC open. The DXY US Greenback Index prolonged Friday’s features and could also be testing a key stage at 93.00 as we speak, exerting downward stress on valuable metals, commodity and ASEAN currencies.

In China, thousands and thousands of individuals have been present process Covid assessments as journey restrictions have been imposed in lots of cities the nation try and combat in opposition to a brand new wave of viral flareups brought on by the highly-contagious Delta variant. Some 125 new confirmed infections have been reported on Sunday, with the bulk discovered within the central metropolis of Zhengzhou and the japanese metropolis of Yangzhou. Efforts to stem the unfold of the virus might trace at slower financial exercise and softer power demand within the months to come back.

Gold Costs – Day by day

Asia-Pacific markets are positioned for a constructive begin to the day. Futures in Japan, mainland China, Australia, Hong Kong, Taiwan, Singapore, Malaysia and Thailand are within the inexperienced, whereas these in South Korea and India are barely decrease.

Hong Kong’s Cling Seng Index (HSI) climbed 0.40% on Monday, lifted by Tencent (+1.76%) and HSBC (+1.39%). Alibaba fell 2.48% after one in every of its managers was investigated for sexually assaulting a feminine worker. The inventory connections registered HK$ 3.45 billion of web Southbound inflows on Monday (chart under), reflecting that extra mainland patrons are returning to Hong Kong’s marketplace for discount looking. Lingering regulatory dangers, nonetheless, should be on the prime of traders’ thoughts.

Supply: Bloomberg, DailyFX

Wanting again to Monday’s shut, 7 out of 9 Dow Jones sectors ended decrease, with 67.7% of the index’s constituents closing within the crimson. Power (-1.67%), healthcare (-0.67%) and knowledge know-how (-0.57%) have been among the many worst performers, whereas shopper staples (+0.38%) and financials (+0.20%) registered small features.

Dow Jones Sector Efficiency 10-08-2021

Supply: Bloomberg, DailyFX

Dow Jones Index Technical Evaluation

The Dow Jones index breached above a key resistance stage at 34,920, thus opening the door for additional features. Costs stay in an “Ascending Channel”, as highlighted on the chart under, suggesting that the general pattern stays tilted to the upside. Bearish MACD divergence means that upward momentum could also be weakening nonetheless.

Dow Jones Index – Day by day Chart

Cling Seng Index Technical Evaluation:

The Cling Seng Index entered a variety certain situation after falling sharply on the finish of July. The near-term pattern has seemingly turned constructive after the MACD indicator shaped a bullish crossover. A profitable breach above the quick resistance stage at 26,650 might sign additional upsides, whereas a break under 25,750 assist might outcome within the reverse.

Cling Seng Index – Day by day Chart

ASX 200 Index Technical Evaluation:

The ASX 200 index has breached above a key resistance stage at 7,500 – the 200% Fibonacci extension. The general pattern stays bullish-biased, as recommended by the consecutive larger highs and better lows shaped over the previous few months. The MACD indicator shaped a bullish crossover and trended larger, suggesting that upward momentum is gaining traction.

ASX 200 Index – Day by day Chart

— Written by Margaret Yang, Strategist for DailyFX.com

To contact Margaret, use the Feedback part under or @margaretyjy on Twitter