Asian stocks and American futures fall on Apple warning
Asian stocks declined after Apple warned about its quarterly revenue. In a statement, the company said that it would not meet its guidance because of the coronavirus outbreak. The disease has limited iPhone’s production and demand. This is because China is the fastest-growing iPhone market in the world. Most iPhones are manufactured in the country. In China, the A50 index and Hang Seng declined by 160 and 401 points respectively. In Australia, the ASX declined by 18 points. In the United States, futures tied to the Dow and Nasdaq declined by 109 and 60 points respectively.
The Japanese yen rose in overnight trading as the number of coronavirus infections continued to rise. According to the Chinese ministry of health, almost 1,900 people have died from the disease. More than 72k have been infected. The number of deaths and infections was smaller than those reported on the previous day. The Japanese yen is often seen as a safe haven currency. Its rise came on the same day the country reported significantly weak economic growth data. Other risk-related assets were also affected. The price of gold rose by 20 basis points while crude oil dropped by more than 1%.
Sterling was relatively unmoved in the Asian session. This could change later today, when the UK releases its wage numbers for December. Data from the Office of National Statistics (ONS) is expected to show that the unemployment rate remained at 5.8% in December. Average earnings ex-bonus is expected to have moved from 3.4% to 3.3%. With bonus, the earnings are expected to have dropped from 3.2% to 3.0%. The claimant count change is expected to have increased from 14.9k to 22.6k. January car registration data will also be released.
Yesterday, the USD/JPY pair rose slightly after Japan released weak economic data. This changed after Apple warned about its iPhone business. The pair declined from a high of 109.95 to a low of 109.65. The price is below the 14-day and 28-day exponential moving averages on the 30-minute chart. It is also slightly above the lower line of the Bollinger Bands. The signal and histogram of the MACD has moved below the centreline. The pair may continue moving lower today.
The EUR/USD pair was little changed in overnight trading. The pair is trading at 1.0830, which is near the lowest level since 2017. The pair has dropped by almost five percent YTD. The price is below the 28-day EMA and along the 14-day moving averages. The RSI has emerged from the oversold level of 25. The pair appears to have found a support at the current level. This means that the pair might have bottomed.
The XBR/USD pair has been on an upward trend since February 10, when it was trading at 53.17. Yesterday, the pair reached a high of 57.50. This changed after Apple’s revenue warning, when the pair dropped to 56.62. The price is along the important support shown in aqua below. The 28-day and 14-day EMAs have made a bearish crossover. The RSI has moved from the overbought level of 70 to the current 42. The pair may resume the upward trend in the near term.