The overnight US session was a non-descript one; the dollar held recent gains; energy edged higher as did equities. Profit-taking hit technology stocks after some recent impressive gains, with investors rotating into more traditional stocks in the Dow Jones.

Things appear to have gone quiet on the geopolitical front for now as well, with China banning some US officials in retaliation for the US efforts vis-a-vis Hong Kong. Still, no concrete retaliation has emerged regarding Tencent or ByteDance. That has drawn a sigh of relief for investors in Asia, with Tencent shares rallying strongly today.

New Zealand’s magical Covid-19 run could be under pressure today, with news just out that a retirement village in Christchurch has been put under lockdown. If testing confirms the presence of Covid-19, as opposed to the flu, for example, amongst residents, both New Zealand equities and the New Zealand dollar may come under short-term pressure.

Singapore’s GDP and Macau gambling have dominated the morning’s news in Asia. Singapore’s GDP shrunk by over 40% in Q2 with construction spending plunging 97%. The data itself, was as expected, and given that most construction workers have been in Covid-19 lockdown, a surprise to no one. The data is weighing on Singapore equities, but not markedly so.

More attention appears to be being given to the renewal of visas for mainlanders to visit Macau and gamble. The two-week return quarantine requirement has also been eliminated. That has seen casino shares soar in Hong Kong this morning, lifting the Hang Seng to the region’s outperformer.

With tier-1 data in short supply until Thursday night and Friday, the directionless trading is set to continue for the next couple of days. Short-term moves are likely to be headline dominated.

Currency and precious metals markets continue to look ripe for further retracements this week, though. Although regional currencies have rallied today, major currencies still look tired on their charts. The US dollar still has the potential to claw back more of its recent losses. Gold, having attracted a lot of fast money last week, could see an accelerated dip should the USD2000.00 an ounce level give way. There appears to still be plenty of selling going through, even at these levels, on the gold/silver ratio, which won’t help matters.