Fundamental Analysis 2017.09.13 – Wall Street, Asian Shares and Japanese Wholesale Prices at Record Highs

13 / 09 / 2017 | Market News
It seems that markets are responding to a slew of good news – and prices around the world are proving it. Asian stocks continued the previous days’ upward trend, even though yesterday was a bit shaky – reaching a 10 year high, possibly a response to Wall Street’s positive return. The Apple stockholder’s excitement over the 1.81% climb of the tech giant’s stock was unjustified as its stock fell 0.42% reaching 160.82 from the previous 161.50 in hours preceding the iPhone 8 release. This was probably due to mixed consumer response, as once again Apple preferred to invest in innovative technology but not assess and amend customer concerns regarding the previous iteration of their technology.  

Japan saw its August wholesale prices develop with its highest pace in the past 9 years. A substantial increase of demand from China was one of the primary contributing factors. This also bolstered the speculation that Japan will also experience a consumer inflation increase pushing it closer to the BoJ’s target of 2%. This is the eighth consecutive climb the index has experienced since the beginning of the year.

The GBP saw a marked increase after the release of very positive inflation data – putting further pressure on the BoE to revise their dovish monetary policy. In fact the GBP price rally pushed the currency up to its highest level this year.

Although US stock was up, the USD slipped against other major currencies. This of course was more an affect of the EUR strengthening than the weakening of the dollar. In fact US Census reports yesterday should have been dollar positive – showing that middle-class income reached its highest levels in history and that sluggish growth post-“Great Recession” is now observable – but it seems that markets are still risk-off the US currency. The reason being that after the enforcement of the UN Sanctions against N. Korea, President Trump went on record promising that the aforementioned sanction would pale in comparison to what “ultimately will have to happen” to stop the country’s nuclear program.

This article comprises the personal view and opinion of the STO Investment Research Desk and at no time should be construed as Investment Advice.
 
 

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