Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Chinese Trade Balance data consistent with an economic upswi

15.19 AEDT, Friday 8 February 2013

Chinese Trade Balance data consistent with an economic upswing


By Tim Waterer (Senior Trader, CMC Markets)

It appears the market was looking for a reason to sell heading into the ECB press conference today. While Draghi’s comments provided a lot of positivity, it was the inflationary concerns that undid the Euro.

A strong Euro and resulting inflationary pressures obviously warrant close attention, however if the Euro is stronger due to growing stability and confidence in the region then this is not the worst dilemma the ECB could be facing. Draghi and co would much rather be in this spot than where they were for much of 2012, where a declining Euro was evidence that traders were fearing the worst for the Eurozone. I suspect that these Euro inflationary issues will not linger as a massive obstacle for the progress of risk assets. Based on what we were facing last year this recent EU drama pales by comparison.

Declines in the Euro and soft US equities added to the Aussie Dollar’s woes on the back of a less than resounding week of domestic Australian macro data. The release today of the RBA minutes echoed the RBA’s ‘ready to cut rates as needed’ stance, while the central bank also pointed to an extended period of below trend growth. From an AUD standpoint there was nothing remotely bullish in the minutes, which is why the AUD slipped to its session low (1.0256) upon the release. Better than expected Chinese Trade Balance data provided some relief for the recently-beleaguered AUD. I expect the AUD will remain under short term pressure however with the macro indicators remaining patchy at best.

Rising Chinese import and export numbers brightened the mood across Asian markets. An increase in the Trade Balance was consistent with recent Chinese data suggesting that the world’s second largest economy is on an upswing. Mining stocks on the Australian sharemarket enjoyed a productive trading session in light of the numbers from China, with RIO and BHP both able to build upon recent gains with growing Chinese imports boding well for our Materials stocks. The Energy and Consumer Discretionary sectors also pushed higher in a well-rounded performance from the local bourse. The ASX200 remains en-route to crack the 5000 level sooner rather than later, with stocks enjoying an extended ‘purple patch’ so far in 2013.
ends

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Interest Rates: Wheeler Hikes OCR To 3% On Inflationary Pressures, Eyes Kiwi

Reserve Bank governor Graeme Wheeler lifted the official cash rate for the second time in as many months, saying non-tradable inflationary pressures were "becoming apparent" in an economy that’s picking up pace and he's watching the impact of a strong kiwi dollar on import prices. More>>

ALSO:

Scoop Business: Equity Crowd Funding Carries Risks, High Failure Rate

Equity crowd funding, which became legal in New Zealand this month, comes with a high risk of failure based on figures showing existing forays into social capital have a success rate of less than 50 percent, one new entrant says. More>>

ALSO:

Scoop Business: NZ Migration Rises To 11-Year High In March

The country gained a seasonally adjusted 3,800 net new migrants in March, the most since February 2003, said Statistics New Zealand. A net 400 people left for Australia in March, down from 600 in February, according to seasonally adjusted figures. More>>

ALSO:

Hugh Pavletich: New Zealand’s Bubble Economy Is Vulnerable

The recent Forbes e-edition article by Jesse Colombo assesses the New Zealand economy “ 12 Reasons Why New Zealand's Economic Bubble Will End In Disaster ”, seems to have created quite a stir, creating extensive media coverage in New Zealand. More>>

ALSO:

Thursday Market Close: Genesis Debut Sparks Energy Rally

New Zealand stock rose after shares in the partially privatised Genesis Energy soared as much as 18 percent in its debut listing on the NZX, buoying other listed energy companies in the process. Meridian Energy, MightyRiverPower, Contact Energy and TrustPower paced gains. More>>

ALSO:

Power Outages, Roads Close: Easter Storm Moving Down Country

The NZ Transport Agency says storm conditions at the start of the Easter break are making driving hazardous in Auckland and Northland and it advises people extreme care is needed on the regions’ state highways and roads... More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news