Low start for Asian markets after drops in US and Europe over the weekend

<p>Asian markets are likely to open lower today given Friday’s leads from the US and Europe. The Dow Jones Industrial Average shed 1.05% while the […]</p>

Asian markets are likely to open lower today given Friday’s leads from the US and Europe. The Dow Jones Industrial Average shed 1.05% while the S&P500 was 1.3% lower.

Corporate reporting season ramps up this week and all eyes will be on earnings, particularly the financial and technology sectors. The news will coincide with retail sales which are due out tonight.

Market expectations are for a 0.3% rise in retail sales following a 1.1% jump in February which was the largest in five months. Anything below 0.3% is likely to see the market pull back a little in anticipation of earnings numbers.

In currencies, the Australian dollar will commence trading softly this morning, last buying around 1.0358 against the US dollar. Expectations of a rate cut are firming for next month.

The Euro was also weaker, last trading at 1.30 against the US dollar. The Australian dollar has actually firmed against the Euro over the past few days, now just shy of 0.7920, below its highs earlier this year but up on last week’s lows. The US dollar was last buying 80.90 against the Japanese Yen.

In regional economic news, The Philippines central bank Governor Amando Tetangco said the central bank will gauge the impact of two interest rate cuts this year when it assesses monetary policy at this week’s meeting.

Market expectations are for the benchmark rate to remain at 4% by the end of the week but The Philippines economy slowed unexpectedly in March to a 30 month low, reporting growth of 2.6% so a cut is not completely out of the question.

In New Zealand, house sales in March recorded the best monthly result since November 2007, rising 25.3% compared to the same period last year.

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.