Daily Markets Broadcast 2018-10-30

Daily Markets Broadcast

2018-10-30

Wall Street tumbles on additional tariff threat

News that Trump’s administration is considering tariffs on all remaining Chinese imports from December, should a planned Trump-Xi meeting at end-November fail, sent markets reeling, pushing indices to multi-month lows.

US30USD Daily Chart

Source: OANDA fxTRade

• The US30 index was performing well yesterday until news emerged of the additional tariffs. That prompted a sharp reversal, sending the index to its lowest since July
• Possible bullish divergence is still evident on the daily stochastics chart, which could imply the spike lower yesterday may be temporary
• The core PCE prices index rose a more-than-expected 0.2% m/m in Sep, data released yesterday showed. The are no major releases scheduled for today.

DE30EUR Monthly Chart

Source: OANDA fxTrade

• Early losses were pared back yesterday and the DE30 index closed higher on the day, touching the highest in a week at one point
• Support at the 55-month moving average at 11,185 remains intact for now, which has supported prices on a closing basis since December 2011. Head and shoulders reversal pattern on monthly chart is still in play
• Euro-zone Q3 GDP growth is seen slowing to 1.8% y/y from 2.1% previously. Merkel says she will not seek re-election as her party leader (current term until 2021).

HK33HKD Monthly Chart

Source: OANDA fxTrade

• The HongKong33 index fell for the fifth straight day yesterday, weighed down by the biggest one-day fall in China shares since February 7 as companies’ profitability fell
• The index is hovering below the 55-month moving average at 24,919, and a close below it would be the first time since December 2016
• Sentiment is likely to follow China shares again after US announced it would consider tariffs on all remaining Chinese imports if the Trump-Xi meeting (probably Nov. 30) yields no results.

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