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Thursday 09.25 GMT
What you need to know
- Tech stocks rebound as investors buy into the sector’s recent dip
- China’s stocks miss out on rebound as worries about leverage linger
- Dollar buoyed by agreement on US tax cuts
- Australian dollar dips on disappointing trade data
- Oil prices find support after slipping over the previous session
- Bitcoin scales $14,000
“Can a ‘buy the dip’ mentality persist? G4 central bank liquidity does not peak until first quarter next year though any drawdown in liquidity will be gradual,” says Neil MacKinnon at VTB Capital.
“A Chinese liquidity squeeze [remains a factor] as the authorities turn the deleveraging screws.”
A rebound for technology stocks has reached Europe, as investors move back into the sector after its recent slide.
The bargain hunting also set the tone in much of Asia, but was not strong enough to lift mainland Chinese indices, where concern about a regulatory crackdown on leverage kept the mood cautious.
The Euro Stoxx technology index is up 0.4 per cent, as the sector out-runs a 0.1 per cent rise for the wider Stoxx 600. London’s FTSE 100 is up 0.2 per cent and Frankfurt’s Xetra Dax 30 are also up 0.3 per cent.
According to futures trade, the tech-heavy Nasdaq will rise 0.3 per cent in opening Wall Street trade, with the S&P 500 set to stay flat.
In China, there is a more jittery feel to trade. The blue-chip CSI 300 is down 1.1 per cent, with the Shanghai Composite down 0.7 per cent. The Shenzhen Composite is down 0.6 per cent.
After a loss of more than 2 per cent over the previous session, Hong Kong’s Hang Seng is up 0.2 per cent, in line with the stronger showing on wider Asian markets. The technology sector led the way, with Apple supplier AAC Technology and index heavyweight Tencent up 1.8 per cent and 2.4 per cent respectively.
Japan’s Topix index is up 1.2 per cent after a fall of more than 1 per cent over the previous session. The IT sector ticked 1.7 per cent higher and industrials rose 1.1 per cent. Nintendo and Tokyo Electron jumped 2.5 per cent and 3.7 per cent respectively.
In Sydney, the S&P/ASX 200 is up 0.5 per cent.
US equities struggled for direction overnight with the S&P 500 ending the day barely changed at 2,629 as the tech sector sub-index rose 0.9 per cent. The energy sector was off 1.3 per cent on lower oil prices.
The dollar is ticking higher, buoyed by the prospect that the plans to cut US taxes that helped it off its September lows will be signed into law by President Donald Trump before the turn of the year.
The index tracking the world’s reserve currency is up 0.1 per cent at 93.672. The euro is flat at $1.1792.
The pound remains unsettled by disappointment that Brexit talks have yet to move on to address trade arrangements. Sterling is down 0.1 per cent at $1.3375 and against the euro it is 0.2 per cent weaker, with £0.8819 required for a unit of the shared currency.
Australia’s dollar is on the back foot following trade data showing the October trade surplus missed forecasts, due to lower demand for iron ore and coal. It is down 0.3 per cent to $0.7543, a two-week low.
The yen is 0.2 per cent weaker at ¥112.54.
Brent is edging higher, up 0.1 per cent at $61.28 a barrel after shedding 2.6 per cent in the previous session. West Texas Intermediate is down 0.1 per cent at $55.93 a barrel. Data released on Wednesday showed crude stocks fell by a bigger than expected 5.6m barrels last week, although petrol supplies rose more than forecast.
Bitcoin climbed to a record high of $14,047, crossing the $14,000 threshold for the first time.
Gold is down 0.5 per cent to $1,258.28 an ounce.
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