From Bloomberg: https://www.bloomberg.com/news/articles/2018-07-24/short-the-aussie-as-worst-is-yet-to-come-top-forecaster-says
Investors should short the Aussie versus the yen as increasing global-trade tensions weigh on the nation’s exports, according to CIMB Bank Bhd. The currency is also poised to decline versus the U.S. dollar, says CIMB, which had the most accurate estimates for the Aussie in Bloomberg’s second-quarter rankings. “On all fronts, the U.S.-China trade war is Aussie-negative,” said Marcus Wong, a treasury strategist at CIMB in Singapore. “Retaliatory action that inadvertently impacts the upstream or downstream of China’s value chain, or leads to a keen deterioration in global risk sentiment, would see a further deterioration in the Aussie.” CIMB sees it sliding below 70 cents if the U.S.-China trade war escalates.
Buy Oil?
From The Australian: https://www.theaustralian.com.au/business/trading-day/business-markets-live/news-story/61d0b6cfd3ca47311a16b0a716e5e064
Oil rises as fears of oversupply ebb. Oil prices have risen as the market shifts focus to the possibility of increased Chinese demand, drawing attention away from oversupply worries and trade tensions between China and the United States. Brent crude settled 38 cents higher on Tuesday at $US73.44 a barrel, after it reached a session high of $US74. US West Texas Intermediate (WTI) settled up 63 cents, or nearly one per cent, to settle at $US68.52. Earlier in the day, WTI reached a high of $US69.05. Reports that China will increase infrastructure spending helped lessen fears that US-China trade tensions will reduce the country’s demand for oil, said Phil Flynn, analyst at Price Futures Group in Chicago. “That’s going to be very bullish for oil demand,” Flynn said. “Infrastructure spending from China in the past had really jacked up oil demand, and I think that’s adding some outside support for prices.”
Indices bullish but trade war caution
From WSJ: https://www.wsj.com/articles/european-markets-follow-asia-higher-1532418546
Earnings Boost U.S. Stocks
- Energy sector is biggest gainer in the S&P 500 as the price of U.S. crude rises
- Dow, S&P 500 rise
- Energy, materials sectors lead gains
- Investors continue to weigh earnings
U.S. stocks rose Tuesday as investors cheered what is shaping up to be a strong corporate-earnings season.
With results in from about 20% of the companies in the S&P 500, the vast majority of companies in the index have posted stronger-than-expected earnings and revenue, according to FactSet. Strong results from Google parent Alphabet helped set the upbeat tone in markets Tuesday. The Dow Jones Industrial Average rose 197.65 points, or 0.8%, to 25241.94. The S&P 500 rose 13.42 points, 0.5%, to 2820.40, and the tech-heavy Nasdaq Composite edged down 1.11 points, or less than 0.1%, to 7840.77, giving up its earlier gains.