Summary:
- China is going to ease negative trade war effects, according to Global Times editor-in-chief Hu Xijin
- China does not list corn, soybeans and pork in its first tariff exemptions, instead China does include US lubricant base oil - tariff exemptions comes into effect on September 17
- Unemployment in South Korea unexpectedly falls being a promising bellwether for the export-driven economy
China to aid its economy
Risk sentiment has improved to some extent this morning following the news that China is going to ease the negative impact of the trade war, according to Global Times editor-in-chief Hu Xijin who tweeted Wednesday morning European time. In his tweet he wrote “Based on what I know, China will introduce important measures to ease the negative impact of the trade war. The measures will benefit some companies from both China and the US.” So far, we have not got information what the policies Beijing could implement. This report came some time ago after US and Chinese officials held phone talks earlier this month. Keep in mind that both countries are going to restart their face-to-face negotiations at the beginning of October. This upbeat revelations has pushed the Aussie dollar higher while Chinese equities have also jumped. At the same time, the US 10-year bond yield keeps hovering at around 1.72% this morning after rallying on Tuesday.
Disappointing exemptions list
Although the above-mentioned report could be considered as positive in terms of risk sentiment, its effect could be somewhat trimmed by another news that China does not include corn, soybeans and pork in its first tariff exemptions list. On the other hand, Beijing does include lubricant base oil, cancer drugs and insect repellent. The exemption is going to take effect from September 17. While key commodities from US exporters’ point of view will not be exempted this time, US farmers may still hope that Beijing will decide to do so in the coming weeks as it wrote in the report that it would keep reviewing applications for tariff exemption and announce other tranches of lists later.
The CHNComp is the best performing Asian index this morning being up more than 1.3% following promising revelations concerning possible steps Beijing may undertake to ease adverse trade war effects. The first major resistance can be localized nearby 11 100 points. Source: xStation5
South Korean unemployment declines
The jobless rate in South Korea unexpectedly fell to 3.1% in August, down from 4% registered in the prior month, the result turned out to be well above expectations suggesting no change for the month. This is the lowest unemployment since November 2013, and the biggest employment increase (it grew 452k in annual terms) since March 2017. Local analysts point to some base effects as the outcome for August 2018 was particularly bad, however, even after taking account of it, the last month result was really surprising. Moreover, the data also showed the loss in manufacturing jobs eased, which could be a promising bellwether for the export-driven economy at a time when the global manufacturing sectors suffers.
South Korean unemployment declined much more than expected last month. Source: Bloomberg
In the other news:
-
Australian Westpac consumer confidence index for September fell to 98.2 from 100
The content of this report has been created by X-Trade Brokers Dom Maklerski S.A., with its registered office in Warsaw, at Ogrodowa 58, 00-876 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. X-Trade Brokers Dom Maklerski S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.
