EQUITIES: Higher In Asia; Chinese, Hong Kong Stocks Rebound
Major Asia-Pac equity indices are firmer, following a positive lead from Wall St. High-beta equities (particularly in China and Hong Kong) outperformed, while materials and energy stocks across the region lagged peers, as commodity prices have made limited headway during Asia hours (BBG Commodity Index: +0.2% at writing).
- Gains in the Hang Seng are the most pronounced amongst major Asia-Pac equity indices, adding 6% at typing to rise from fresh six-year lows made on Tuesday. A strong rebound was observed in heavily depressed sectors (particularly China-based tech), with the Hang Seng Tech Index adding 11.6% at writing (the most on record), outstripping a 5.0% rise in the NASDAQ Golden Dragon China Index (made up of ADRs of several large-cap Chinese tech companies) in Tuesday’s session.
- The Chinese CSI300 was ahead of most regional peers as well, sitting 2.1% higher at writing. The index surged after extensive comments from China’s Vice Premier Liu He, announcing the government's intention to support the economy and promote stock market stability. This also factored into the bid in the Hang Seng.
- U.S. e-mini equity index futures also drew support from Liu He’s comments, last printing 0.1-0.4% firmer on the day.
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EQUITIES: Asia Mostly Lower, Friday’s Lows Hold In E-Minis
Benchmark east Asian equity indices trade lower amidst a negative lead from Wall St., after heightened worry re: the Russia-Ukraine situation weighed on risk assets at the backend of last week’s final NY session. The Nikkei 225, TAIEX and KOSPI are 1.7% to 2.2% worse off at typing, after edging away from worst levels observed earlier in the session. The Hang Seng and CSI300 fell less than their major Asia-Pac peers, dealing 1.2% and 0.7% softer respectively.
- Australia’s ASX 200 provided the lone bright spot amongst Asia-Pac equity indices, as gains in energy and heavily weighted financials countered sharper losses in tech stocks, helping the ASX200 to add 0.4% by end of Monday’s trade.
- E-mini equity futures are ~0.2% better off at typing, after Friday’s lows held in early Asia-Pac trade. The lack of outright weekend escalation surrounding the Russia-Ukraine situation probably facilitated such a move (it would have also facilitated the bounce from lows for some of the major Asia-Pac indices).
BOBL TECHS: (H2) Trend Remains Down
- RES 4: 132.582 50-day EMA
- RES 3: 132.060 High Feb 3
- RES 2: 131.655 20-day EMA
- RES 1: 131.360 High Feb 11
- PRICE: 131.010 @ 05:06 GMT Feb 14
- SUP 1: 130.080 Low Feb 10
- SUP 2: 130.000 Psychological round number
- SUP 3: 129.460 High Dec 7, 2015 (cont)
- SUP 4: 129.020 Low Dec 7, 2015 (sont)
Bobl futures are trading above recent lows but remain in a clear downtrend. Continued selling pressure and fresh trend lows maintain the bearish price sequence of lower lows and lower highs. Moving averages are in a bear mode too and attention is on the psychological 130.00 handle next. Initial resistance is seen at 131.360, Feb 11 high. Short term gains would be considered corrective.
BUND TECHS: (H2) Trend Needle Still Points South
- RES 4: 169.79 50-day EMA
- RES 3: 167.81 20-day EMA
- RES 2: 167.00 High Feb 4
- RES 1: 166.46 Jan 11 high
- PRICE: 165.94 @ 05:01 GMT Feb 14
- SUP 1: 164.37 Low Jan 10 and the bear trigger
- SUP 2: 164.00 Round number support
- SUP 3: 163.63 Low Mar, 2019 (cont)
- SUP 4: 162.60 76.4% retrace of the Oct ‘18 - Sep ‘19 bull cycle (cont)
Bund futures remain in a clear downtrend although the contract is trading in a more volatile manner. Last week’s move lower, reinforced bearish conditions and this maintains the bearish price sequence of lower lows and lower highs. Moving average conditions are in a bear mode set-up too highlighting current sentiment. The focus is on the 164.00 handle next. 166.46 is initial resistance, the Jan 11 high.
