An overview of the coming day in Asian markets.
An important week for global markets begins in Asia on Monday, investors continuing to navigate the Blizzard of titles concerning the probable economic program of the American president Donald Trump, while trying to assess whether the story of “American exceptionalism” is Maybe losing its sparkle.
The dollar dropped 1.8 % last week, its worst week since November 2023. If the greenback is consolidated, it is not really a surprise: it has reached its highest level in two years at the beginning of the month And the “long” net position of hedge funds has been the largest in nine years.
The dollar and American actions have been closely correlated, supported by the huge wave of influx of world capital, investors betting strongly on the American boom in artificial intelligence, technology, growth and yields.
But if the fall in the dollar is a sign that the flame of “American exceptionalism” begins to fade, is Wall Street also ready for a cooling period?
The S&P 500 reached a new summit last week and the Nasdaq approached it. The levels of the indices are historically high, the valuations are tense and a risk of a major event is looming this week, in the form of the Fed policy meeting and the profits of “Big Tech”.
Surveillance of American technology intensifies as the fallout of a Chinese startup specialized in artificial intelligence, Deepseek. Deepseek recently launched a free AI model and with an open source code which, according to her, is at least equal to more established models like Chatgpt in many respects, but constructed at a cost fraction.
It is still early, but if that sheds critical light on the colossal sums devoted to AI by American technological companies, Wall Street could vacillate.
Monday’s Asian calendar is dominated by China’s “official” reports on the Manufacturing and Service Sector Purchasing Sector Bike Directors.
-According to a Reuters survey, the PMI index of the manufacturing sector should remain unchanged from the previous month at 50.1. On the one hand, this would represent the fourth consecutive month of expansion in the sector. On the other hand, this would indicate almost zero growth for the second consecutive month.
Friday data has shown that the benefits of Chinese public enterprises were practically evaporated last year, only increasing 0.4 % compared to the previous year. Profits in the industrial sector in general are expected this week, perhaps on Monday, and should confirm that 2024 has been the worst year for decades.
Investors will give their verdict of the second day on the increase in rates of the Bank of Japan on Friday. The initial opinion seemed to be that it was a “Hawkish increase”, but the Japanese monetary markets still predict only an additional tightening of 25 base points this year, unchanged from the levels before Friday . This suggests that the guidelines of the BOJ were in fact quite neutral, and the term contracts on Japanese actions indicate a sharp increase for Monday.
Meanwhile, the South Korean markets will be sensitive to the news according to which the prosecutors charged President Yoon Suk Yeol on Sunday for carrying out an insurrection during the ephemeral taxation of martial law on December 3.
Here are the main developments that could guide the markets on Friday:
– China “official” PMI (January)
– Advanced Japan indicator (November)
– IFO index of Germany (January)
