Morning wrap (06.02.2023)

• Indices from Asia-Pacific launched a new week lower amid increase in US-China tensions. S&P/ASX 200 dropped 0.2%, Kospi traded 1.2% down, Nifty 50 declined 0.6% and indices from China traded up to 2% lower. Nikkei was an exception and gained 0.5%

• The US Air Force shot down a Chinese spy balloon that flew over continental United States. US Administration waited until the balloon leaves residential areas in order to limit potential damage from falling debris

• US Secretary of State Blinken canceled his trip to China, that was scheduled for this week

• DAX futures point to a slightly lower opening of the European cash session today

• US index futures trade more or less flat compared to Friday's closing prices

• A powerful 7.8 magnitude earthquake hit southern Turkey. Around 200 have been killed in Turkey and Syria combined, but the number keeps growing. Turkish government asked for an international aid

• According to Reuters report, Indian refiners started to pay for Russian oil in UAE dirhams

• Australian Trade Minister Farrell said that he was invited for a trip to China and meeting with his Chinese counterpart

• ECB's Visco said that ECB can continue to tighten policy further but should be more cautious given the scale of tightening already delivered

• Nikkei reports that authorities approached BoJ Deputy Governor Masayoshi Amamiya as potential successor to current BoJ chief Haruhiko Kuroda

• Australian retail sales dropped 0.2% QoQ in Q4 2022 (exp. -0.6% MoM)

• Cryptocurrencies are trading mostly lower at the beginning of a new week. Bitcoin drops 0.9%, Ethereum trades 0.5% down and Dogecoin dips 0.3%

• Energy commodities is trading higher at the beginning of a new week. Brent and WTI gain around 0.5% each while US natural gas prices jump almost 3%

• Precious metals benefit from USD weakening. Gold and silver add 0.7% each while platinum gains 0.2%

• AUD and GBP are the best performing major currencies while USD and JPY lag the most

S&P 500 (US500) failed to break above the 4,165 pts resistance zone last week and started to pull back. The move lower is being continued today. Tensions between China and the US are picking-up after the US Air Force shot down a Chinese spy balloon over the weekend. Source: xStation5