Inflation cools, TSMC offers AI weather vane
By Jamie McGeever
Oct 17 (Reuters) -A look at the day ahead in Asian markets.
Markets across Asia should open on a firm footing on Thursday, supported by a rebound on Wall Street and softer Treasury yields the day before, and growing signs that global inflationary pressures are broadly easing.
Asia's economic calendar on Thursday sees the release of the latest international trade data from Japan and Singapore, and Australian unemployment.
The main three U.S. indices all closed in the green on Wednesday with banks and small caps leading the rise. Big Tech, however, remains under pressure, which may intensify the spotlight even more on TSMC's third quarter results on Thursday.
Taiwan Semiconductor Manufacturing Co, the main producer of advanced chips used in artificial intelligence applications, is expected to report a 40% leap in profit to T$298.2 billion ($9.27 billion) thanks to soaring demand.
The world's largest contract chipmaker, whose customers include Apple, Nvidia and ASML, has benefited from the global surge towards AI. A miss or weak guidance, however, could trigger another wave of selling across Big Tech.
But assuming analysts' estimates are met or even exceeded, the backdrop to Thursday's session in Asia looks favorable, despite the dollar's tick higher. The VIX index of U.S. stock market volatility dipped back below 20.0 on Wednesday and oil fell for a fourth day in a row.
Falling oil prices are often a warning of weak global economic activity and demand. A huge miss and surprising slump in Japanese machinery orders on Wednesday will only have strengthened those concerns.
But the disinflationary pull from oil's weakness cannot be ignored, and if investors like one thing it's lower interest rates. In that light, investors will have been encouraged by the price signals from around the world over the last 24 hours.
Inflation in New Zealand was slightly weaker than expected, inflation in Britain was much weaker than expected and sure to cement UK rate cut expectations, while the Bank of Thailand delivered a surprise rate cut.
With the European Central Bank widely expected to cut rates on Thursday by 25 basis points for a second meeting, to 3.25%, global financial conditions are loosening. Rates traders currently expect the Fed, ECB and Bank of England each to cut rates another 50 bps and the Bank of Canada to cut at least another 75 bps by the end of the year.
That's a lot of easing, especially without a recession, at least in the US. Indeed, if there is a US recession coming, someone forgot to tell the corporate bond market, where spreads are now the tightest in nearly 20 years.
This is usually where the first hints of recession are seen as investors move to price the impending impact of rising unemployment, slowing growth and consumer weakness on companies' debt loads.
Here are key developments that could provide more direction to markets on Thursday:
- Australia unemployment (September)
- Japan trade (September)
- Taiwan's TSMC earnings (Q3)
TSMC shares - doubled in price in last year https://tmsnrt.rs/4883BDK
Selected emerging Asia rate forecasts - JP Morgan https://tmsnrt.rs/4dO5nLF
Reporting by Jamie McGeever
Aset Terkait
Berita Terbaru
Pengungkapan: Entitas XM Group menyediakan layanan khusus eksekusi dan akses ke Fasilitas Trading Online kami, yang memungkinkan Anda untuk melihat dan/atau menggunakan konten yang tersedia pada atau melalui situs, yang tidak untuk mengubah atau memperluas, serta tidak mengubah atau memperluas hal tersebut. Akses dan penggunaan ini selalu sesuai dengan: (i) Syarat dan Ketentuan; (ii) Peringatan Risiko; dan (iii) Pengungkapan Penuh. Oleh karena itu, konten disediakan hanya sebagai informasi umum. Anda juga harus ketahui bahwa konten Fasilitas Trading Online kami bukan sebagai ajakan atau tawaran untuk untuk melakukan transaksi apa pun di pasar finansial. Trading di pasar finansial mana pun melibatkan tingkat risiko yang signifikan pada modal Anda.
Semua materi yang diterbitkan di Fasilitas Trading Online kami hanya untuk tujuan edukasi/informasi dan tidak boleh mengandung nasihat dan rekomendasi finansial, pajak investasi atau trading, catatan harga trading kami, penawaran, permintaan, transaksi dalam instrumen finansial apa pun atau promo finansial untuk Anda yang tidak diminta.
Konten pihak ketiga apa pun, serta konten yang disiapkan oleh XM, seperti opini, berita, riset, analisis, harga, informasi lain atau link ke situs pihak ketiga yang tersedia "sebagaimana adanya", sebagai komentar pasar umum dan bukan menjadi nasihat investasi. Sejauh konten apa pun ditafsirkan sebagai penelitian investasi, Anda harus memperhatikan dan menerima bahwa konten tersebut tidak dimaksudkan dan belum disiapkan sesuai dengan persyaratan hukum yang dirancang untuk mempromosikan kemandirian riset investasi dan dengan demikian akan dianggap sebagai komunikasi pemasaran di bawah hukum dan peraturan yang relevan. Mohon dipastikan bahwa Anda telah membaca dan memahami Notifikasi pada Riset Investasi Non-Independen dan Peringatan Risiko kami mengenai informasi di atas, yang dapat diakses disini.
