The US dollar is under pressure in Asia

Photo by Ian Walton/Getty Images

It’s been a quiet start to the week for Asian markets.

While some of the prevailing themes of recent weeks are being maintained — developed market stocks are, as a whole, outperforming their emerging market peers while base and bulk commodity futures continue to rip higher — others are starting to show signs of fatigue.

Of note, the US dollar is coming under some rare selling pressure, at least compared to recent norms, undermined by a continued retracement in US bond yields.

The largest move has been in the USD/JPY which has plunged 1.16% to 111.75, something which is creating weakness in Japanese stocks as a consequence.

The weakness in the US dollar has become more acute since mainland Chinese markets opened with both the Chinese yuan and stocks pushing higher in recent trade.

The Shanghai Composite index is currently up 0.23% at 3,269.29, sitting at the highest level since January 7 this year.

Here’s the scoreboard as at 2pm in Sydney:

Stocks

  • Australia ASX 200 5485.60 , -0.40%
  • NZ NZX 50 6908.19 , 0.12%
  • Japan TOPIX 1459.13 , -0.37%
  • Shanghai Comp 3269.29 , 0.23%
  • Shenzhen Comp 2129.95 , 0.01%
  • HK Hang Seng 22865.85, 0.63%
  • Sth Korea KOSPI 1981.47 , 0.36%
  • Sinagpore STI 2882.64 , 0.82%
  • Taiwan TAIEX 9226.58 , 0.74%
  • Philippines PSI 6853.73 , -0.52%
  • Indonesia JKSE 5101.94 , -0.39%
  • Malaysia KLCI Index 1626.06 , -0.07%
  • Thailand SET 1502.76 , 0.16%
  • India Nifty 50 8114.3 , 0.00%
  • S&P 500 Futures 2205.25 , -0.27%

Currencies

  • AUD/USD 0.7463 , 0.44%
  • NZD/USD 0.7084 , 0.63%
  • USD/JPY 111.75 , -1.16%
  • USD/CNY 6.9013 , -0.24%
  • USD/CNH 6.9247 , -0.29%
  • USD/HKD 7.7555 , 0.00%
  • USD/KRW 1170 , -0.45%
  • USD/SGD 1.4226 , -0.43%
  • USD/TWD 31.79 , -0.17%
  • USD/PHP 49.76 , -0.13%
  • USD/MYR 4.457 , 0.09%
  • USD/IDR 13475 , -0.30%
  • USD/THB 35.54 , -0.22%
  • USD/INR 68.36 , -0.21%
  • US Dollar Index 100.74 , -0.74%

Commodities

  • Brent Crude $47.22 , -0.04%
  • Gold $1,193.60 , 0.91%
  • Silver $16.74 , 1.45%
  • SHFE Copper ¥48,590 , 0.68%
  • SHFE Aluminium ¥13,985 , -0.04%
  • SHFE Zinc ¥24,270 , 6.38%
  • SHFE Nickel ¥96,210 , 1.07%
  • SHFE Rebar ¥3,193 , 4.89%
  • DCE Iron Ore ¥652.00 , 2.11%
  • DCE Coking Coal ¥1,598.00 , 2.63%
  • DCE Coke ¥2,225.00 , 4.66%

10-Year Government Bond Yields

  • United States 2.329% , -0.041%
  • Japan 0.011% , -0.024%
  • Australia 2.711% , -0.064%

As this chart from IG Markets chief market strategist Chris Weston shows, the selling in the US dollar has the US dollar index, or DXY, now testing a crucial support level on the charts.

A break below this level could lead to an even greater reversal of some of the market moves seen since the US election on November 8.

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