Chinese stocks rebound, but bears remain in control

Michael McKenna

Head of Editorial Content, Saxo Bank

The forex space into today's European open sees a soft euro, comparative USD strength by default, and the CNY trading in a 6.844-6.86 range overnight, reports Saxo Bank Head of FX Strategy John Hardy.

"We also saw a pronounced spike in the Turkish lira, which pushed through the 5.40 area versus USD overnight," says Saxo's forex chief.

Down under, the AUD maintains a bid despite no real support from the Reserve Bank of Australia's meeting and statement.

In stocks, Saxo equities head Peter Garnry says the rebound in Chinese shares overnight does not shift the overall narrative with trade war fears and higher USD rates still dominant in APAC.

"The bears remain in control [of the Chinese stock market]," Garnry concludes.

In commodities, Saxo head of Commodity Strategy OIe Hansen reports that the strike action threatened at the world's largest copper mine in Chile may have been averted. "BHP Billiton has apparently blinked," Hansen says, adding that a five-day mediation session is set to follow.

Finally, Saxo technical analyst Kim Cramer Larsson says that the S&P 500 appears poised for a move on its all-time high.

For more on stocks, FX, commodities, and technical analysis, watch today's Morning Call in full.

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