There is a hint of risk aversion ahead of European trading as Asia views red for the most part on concerns regarding a retail trading frenzy as the chaos from the memes took over the market in trading yesterday and that is reflecting today.
Adding to that is talk of a liquidity squeeze in China with overnight repo rates rising to their highest level in almost six years not helping.
The PBOC did little to calm nerves as the ¥100 billion injections today is largely insufficient to deal with the liquidity shortage that may arise from the coming Lunar New Year holidays.
Elsewhere, the Hang Seng is down by 0.6% and Shanghai Composite down by 0.9%. Meanwhile, US futures are also being dumped with S&P 500 futures down 1.1%, and Nasdaq futures down 1.3% as we look towards European trading.
This is all contributing to a stronger dollar for the time with commodity currencies lagging slightly. But as we saw from yesterday, things can quickly turn around in the coming hours but just be wary that conditions may be trickier today amid the month-end.
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