No news is good news
The new trading week has started out on a positive note. Taking a look at the Asian markets, equities have leapt higher on Monday morning, along with US Index Futures, as the ‘no new news is good news’ trade resumes. The Bank of Japan increasing its targeted 5 and 10-year JGB buying targets proves yet again that global central banks have got investors’ backs. That has ensured the Nikkei 225 is off to a positive start, rising 1.55% today.
The Kospi is up by 0.80%, boosted by a jump in LG Electronics. Over in China, the financial sector and real estate stocks are leading the way higher yet again, in a repeat of Friday’s price action. The Shanghai Composite and CSI 300 have risen by 2.0%.
US equity futures have joined in the fun, with the retail herd jumping onto the early-week upward momentum, probably having come in from their Sunday BBQ’s. The S&P mini and Nasdaq futures have risen 0.50%.
Across Asia, the story is much the same, with the week kicking off with gains. The Hang Seng has jumped 2.0% with its mainland counterparts. The Straits Times is up 0.80% with Kuala Lumpur up 1.05%. The only blot has been in Australia. Covid-19 is weighing on sentiment after New South Wales announced it would close its border with Victoria, and new cases continued to rise in Melbourne.
US Non-Manufacturing PMI expected to rise
With some clear upward momentum to equities as the week starts, only an ugly headline bomb could ruin the party. That sentiment is likely to continue through Asia today and into Europe and the US, with no economic data of note that could upset the applecart. In the US, the focus is on the services sector, with the release of Non-Manufacturing PMI this evening. The PMI has recorded two successive releases below the 50-level, which points to contraction. The index improved to 45.4 up from 41.8 beforehand. The upswing is expected to continue, with an estimate of 50.0 for the June release.