Asian equities could trade pressured after bearish headwinds, and month-end trade hit European and US peers yesterday. The Tech sector in Asia and manufacturers could take a hit after Apple downgrade from Bank of America as the bank expects a negative impact on the company from weakening consumer demand. The negative reaction to Apple shares added selling flows to the sector. Traders will watch more downgrades ahead as the global economic outlook seems fragile, with a growing number of participants cutting risky bets and seeing an economic recession ahead.
On the macro front, the Yuan fell following news that Chinese banks were told to prepare for currency intervention, and the PBoC suggested mortgage rate floors could be relaxed as the key real estate sector remains in distress. Traders will be reading the Chinese Official PMIs data eyeing any improvement after some easing of COVID restrictions and commodity prices. Still, headwinds from slowing global demand for Chinese goods for the upcoming quarters could keep participants in a ‘wait and see’ mood. Later in the session, traders will be eying inflation data from the US with Core PCE for August set to be released, and Fed’s Brainard and Williams are the major risk events for today, with month/quarter-end also on the radar.
