A Historic Day?? Pay Attention to the Chinese Market After the Spring Festival: "Focus Points and Event Schedule for February 3"
Today, China is after the Lunar New Year, and there is close attention on whether the markets and Chinese economy will become unsettled.
The risk-off trend is expected to continue today as well.
It doesn’t seem China will just stand by and watch.
As the Chinese market opens, we want to observe what actions will be taken and how price movements will unfold.
Perhaps today will see historic price movements, and we are paying close attention.
◎ Today's Points of Attention
1) China/Shanghai Market Reopening
From today, the Chinese market will reopen.
Earlier, Hong Kong reopened with a large 8% drop.
A similar or greater drop is expected for the Chinese market that reopens today.
Concerns include circuit breakers triggering if declines are large or rapid, potentially causing further confusion.
China is said to be injecting about 18 trillion yen in liquidity, aiming to minimize market turmoil as much as possible.
Additionally, sales restrictions are expected to be imposed, making it hard to predict how markets will move.
Given this, today’s Chinese market is expected to be a historic day.
There is also attention on whether a volatile Chinese market will spill over to Tokyo and Western markets.
2) New Coronavirus
Infections continue to rise, surpassing 15,000, and deaths have exceeded 360, with the first fatalities outside China reported.
We are watching where the infection surge will peak.
Also, to prevent spread, many Chinese companies and shops are not resuming operations even after the Lunar New Year.
We are watching how much economic activity will decline.
3) Economic Indicators
Today PMI data will be released for China, Europe, the UK, and the US.
In Europe and the US, the PMI figures are revised, so deviations from forecasts may be limited and movements could be subdued; however, China’s Caixin Manufacturing PMI and the UK’s Manufacturing PMI, and the US ISM Manufacturing Index may move significantly depending on the deviation from expectations, so they are worth watching.
◎ Today's Event Schedule
February 3 (Monday)
09:30 AUD Building Permits
10:45 CNY Caixin Manufacturing PMI
16:00 TRY Turkey CPI (Consumer Price Index)
16:30 SEK Sweden Manufacturing PMI
17:00 NOK Norway Manufacturing PMI
17:45 EUR Italy Manufacturing PMI (revised)
17:50 EUR France Manufacturing PMI (revised)
17:55 EUR Germany Manufacturing PMI (revised)
18:00 EUR Euro Area Manufacturing PMI (revised)
18:30 GBP UK Manufacturing PMI
23:45 USD US Manufacturing PMI (revised)
February 4 (Tuesday)
President Trump’s State of the Union Address
00:00 USD ISM Manufacturing Index
06:00 USD Bozzi Thompson Atlanta Fed President comment
06:45 NZD Building Permits
