Asian equity markets started the session moderately flat, notwithstanding the gains seen on Wall Street, which saw the Nasdaq to fresh all-time highs. The recent positive sentiment of participants on the long duration assets like the tech might boost major tech stocks in Asia. Supporting the bullish tech sentiment was Fed Chair Powell, who reiterated that the FOMC would not raise rates pre-emptively and respond to unemployment shortfalls. Moreover, he affirmed a more balanced policy stance to some recent hawkish Fed rhetoric.
On the trade and commodity front, newswires reported yesterday that China is set to sell 20k tons of copper, 30k of zinc, and 50k of aluminium from state reserves, following up on its recent rhetoric against rising commodity prices. Worth keeping an eye on the crypto space as Bitcoin fell sub-30k before rebounding and looks to enter the Asia session on the front foot. Despite further bouts of commentary recently from Chinese officials, the crackdown is set to continue. If the sell-off persists, it could generate a contagion effect in the global assets as traders will look to hedge the risk as other participants might start closing their exposure in the sector. Also, margin calls on leverage funds and positions could weigh on the risk tone.
