Asia Open
Asian stocks look set for a positive open, with Nikkei +1.67%, ASX +0.52% and KOSPI +1.00% at the time of writing. A dovish takeaway from the Bank of Japan (BoJ) meeting has brought much cheers for Japanese equities, with the Nikkei 225 index setting its sight to retest its year-to-date high at the 34,000 level once more.
Chinese equities are also regaining some traction, with the Nasdaq Golden Dragon China Index up 1.8% overnight, but a clear recovery trend in economic conditions may still be needed to sustain any gains ahead. For now, China authorities have kept its one-year and five-year loan prime rate unchanged earlier today, which is in line with market expectations. Further accommodative policies remains on the lookout into next year to stabilise growth, amid the on-and-off recovery momentum that we have seen over the past months thus far.
Speculators expecting a more hawkish shift in policy wording from the BoJ are disappointed yesterday with the central bank delivering little surprise, choosing to stick to its muddled script for any policy exit. The USD/JPY has managed to pare some earlier losses, but the broader trend seems likely to remain on the downside. This comes as the pair has broken below its Ichimoku cloud support on the daily chart for the first time since April this year, alongside with a rising channel breakdown earlier this month. The 145.20 level will serve as immediate resistance to overcome, failing which may pave the way to retest its December low at the 141.50 level.
