By Andrew Galbraith
SHANGHAI (Reuters) – Yields on Chinese stocks and the yuan's stronger than expected daily fixation helped keep a broad range of Asian stocks afloat on Monday, but the firm gold price underscored concern investors on risk MSCI's broadest index of Asian Pacific equities outside Japan precluded early losses to add 0.02%.
Ryan Felsman, chief economist at CommSec in Sydney, said there had been a "positive reaction" to Monday's fix, including a rebound in the Australian dollar, as it reassured investors that China would not steadily weaken the yuan ,
At the same time, uncertainty over the solution to the trade conflict between the US and China is fueling market volatility, said Felsman.
A week ago, China allowed it The International Monetary Fund announced on Friday that it exceeded the 7-per-dollar mark for the first time since 2008, prompting Washington to call Beijing a currency manipulator that triggered market destruction.
The value of the Chinese yuan was broadly in line with economic fundamentals.
On Monday, Australian equities fell 0.17% and Indonesian equities 0.3%, while the South Korean market lost 0.39%.
Trad Some regional markets, including Japan, Singapore and India, closed on Monday for bank holidays.
On Friday, Wall Street witnessed a three-day streak of victory after US President Donald Trump announced this. Washington continued the trade talks with Beijing, but the US did not want to reach an agreement for the time being.
These comments contributed to a late sell-off in a volatile session in which the Dow Jones Industrial Average fell 0.34%. The S & P 500 lost 0.66% and the Nasdaq Composite 1%.
The White House Trade Adviser, Peter Navarro, later said that the United States is planning yet another round of trade talks with Chinese negotiators.
Allegation of injury The effects of the war on trade were underlined by a warning from Goldman Sachs of the growing risk of a recession in the US, according to which no trade agreement is expected before the US presidential election in 2020.
little positive news. Last week's data showed that the UK economy slumped unexpectedly in the second quarter for the first time since 2012, while German industrial production recorded the largest annual decline in nine years. All this led to global fears of recession as the escalating Sino-US customs war affected trade and investment.
"Cross-asset correlations and cash flow continue to tell us that this funk is a real result of fear in the markets and the uncertainty of traders and investors," said Greg McKenna, a strategist at the Australian financial advisory firm McKenna Macro 2013. The precious metal made some early gains on Monday, but recently traded flat at $ 1,496.70 an ounce.
In the currency markets, the pound reached its January 17, 2017 low against the US dollar and only purchased $ 1.2015 on an early Asian Monday, before rising to $ 1.2037.
The British currency came under pressure on Friday after weak UK data.
The dollar fell 0.2% against the yen to $ 105.45 and the euro rose to $ 1.1205.  9659023] The dollar index, which tracks the greenback against a basket of six major competitors, remained flat at 97.493.
China's onshore yuan depreciated slightly against the dollar, rising to 7.0623, while its offshore counterpart gained 0.06% to 7.0918 per dollar.
] "The market has put up with higher (yuan) fixings and will now focus on establishing a new balance for USD / CNY … It is unlikely that the PBOC will trigger excessive speculative downside pressure on RMB "After the USD / CNY traded above 7," Bank of America analysts Merrill Lynch said in a note.
Oil prices have fallen after rising sharply on Friday as a result of a decline in European stocks and production cuts by the organization of the oil-exporting countries.
US crude dropped 0.28% to $ 54.35 a barrel and Brent crude fell 0.14% to $ 58.45 a barrel.
(Report by Andrew Galbraith, Editor of Shri Navaratnam and Richard Borsuk)