Asian Shares went Flat as Market Watches Fed

On Thursday, Asian shares remained firm as markets became worried over the future of interest rates and global fiscal stimulus. Moreover, most of the shares’ movement were minuscule.

For example, E-Mini futures for S&P 500 and EURO STOXX 50 futures dipped around 0.04% to 0.09%. And Wall Street also got out of the fire by the unexpected outcome from retailers.

Then, after the statement of President Donald Trump about the reversed course and not looking at chopping payroll taxes, hopes for U.S. fiscal stimulus got knocked down.

Fed Chair

Now, as Asian shares stood firm, most of it depends on how dovish Fed Chair Jerome Powell will be during his Jackson Hole speech this Friday.

Macro Strategist Alan Ruskin stated, “The most sensitive comments will revolve around whether Powell is willing to reaffirm a view that the easing cycle is a mid-cycle adjustment or align more closely to market thinking.”

Ruskin also mentioned that if the Fed Chair gels with the old language, it might be clear that he is positive that the “strength of consumption.” And in “combination with modest Fed easing” is enough to have the recovery broadly on track.

As a result, that will be more hawkish than expected. And it might possibly boost the dollar further.

Meanwhile, away from the Asian market, the dollar bounced overnight on Thursday and was last at 98.247 against a basket of major currencies from a low of 97.948. Aside from that, it also hit 106.50 yen from Wednesday’s trough of 106.21.

Then, the euro went back to $1.1089 from its previous top of $1.107. And the depressing economic outlook from Germany’s finance ministry did not help in the progress of the currency.

On Thursday, a range of manufacturing surveys released from across the globe. And it shows a further slowdown in activity, mostly in Europe.

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