- US-Iran creating a war like situation while US-China trade talks also seem dismal to praise.
- AU election result and removal of steel and aluminum duties from Canada and Mexico support market optimism.
Be it escalating trade tension between the US and China or the US President Donald Trump’s fury over Iran, not to forget Australian general election, Asian markets had a busy start to the week during Monday.
However, investors’ reaction to the political news reports was mixed amid different signals for varied stocks.
MSCI’s gauge of Asia-Pacific shares ex-Japan was more than 1.0% down during the press time as traders considered the latest reports from China as giving rise to a new tariff war between the world’s two largest economies.
Japan’s Nikkei flashed +0.30% gains by the time of writing whereas China’s Hang Seng was -0.3% down.
Further, Australia’s ASX 200 surged to the highest since December 2007 with close to 2.0% profits after Prime Minister Scott Morrison registered surprise victory in the general election and offered tax relief hours after being elected. New Zealand’s NZX50 also tracked gains of its largest trading partner and grew +0.30%.
Global risk tone was also volatile as shown by the US 10-year treasury yield remained positive to 2.4%.
With the US President’s latest fury over Iran and China’s readiness to retaliate to the US tariffs likely pushing the share traders on their toes, safe-havens may keep dominating market players’ mind, which in turn plays negative for the equities. Though, news results from Australia and Canada can help commodity-linked currencies and their stocks.