Sentiment Weak, Another Attack Against China From Washington

Market Reviews

Loonie dropped to trade as the softest. Kiwi and Aussie are weak as well. Asian shares are trading in red, US market is burdened as well on Donald Trump’s attack against China. Nikkei reduced 0.02% to 22865.15. China Shanghai SSE fell -0.32%, Hong Kong HSI dropped -0.99% and Singapore Strait Times was down -0.32%. DOW lowered -0.53%, S&P 500 tumbled -0.44% and NASDAQ declined -0.26% Meanwhile, Swiss Franc is the firmest. Euro and Pound are strong too.

Donald Trump claimed that China was trying to devalue its Yuan, and his administration is looking for some evidence of a currency manipulation. The U.S. President also stated that Washington is ready impose 25% tariffs on USD 200 billion of Chinese imports starting from next week. He said: “we are a much stronger country,” and “nobody’s waiting us out. Our country is stronger than it’s ever been financially.” The People’s Bank of China set the reference rate stronger than projections for 17 days in a row, to slow the Yuan’s fall. The currency’s fixing was 0.1% stronger than the average estimate in a Bloomberg survey. Donald Trump also refused to roll back auto tariffs against EU.

Chrystia Freeland (Canadian Foreign Affairs Minister) met with US Trade Representative Robert Lighthizer. Unfortunately, Freeland reported: “no, we don’t have an agreement,” and the negotiation would “reconvene in the morning” on Friday. The Minister assured: “we continue to be encouraged by the constructive atmosphere,” and “there’s a lot we’re trying to do in a short period of time.” And for now, she is “focused on working hard on our issues with the United States”, not the Mexico yet.

UK Gfk consumer confidence rose from -10 to -7 in August. Japan industrial production fell -0.1% mom in July. Housing starts reduced -0.7% yoy. Jobless rate increased 0.1% to 2.5%. Tokyo CPU core lifted to 0.9% yoy in August. China official PMI manufacturing surged 0.1 to 51.3. Official non-manufacturing PMI was up 0.2 to 54.2. Today, Eurozone will publish unemployment and August CPI flash data, Canada will feature IPPI and RMPI and US will announce Chicago PMI.