Originally published by CMC Markets
International trade has turned from market negative to positive in two days. Following President’s Xi’s resetting of the public dialogue share markets rallied again overnight on reports the White House is investigating re-joining the Trans Pacific Partnership trading agreement. Bonds and gold fell, and oil rose as the economic clouds cleared.
The positive impulse should lift Asia Pacific markets at today’s openings. However important China trade data due today and the start of the US company reporting season tonight could see investors react cautiously.
China’s March trade balance is expected to contract to around US $28 billion, down from $34 billion in February. A surprise blow out is the risk, given its potential to embarrass the US. On the other hand a smaller than expected trade surplus could add to positive market moves.
JPMorgan (NYSE:JPM), Wells Fargo (NYSE:WFC) and Citigroup (NYSE:C) report quarterly earnings tonight. Australian banks remain under pressure from the Royal Commission inquiry. Any thematic surprise for US banks could change the focus for local banks, and may bring a relief rally to the sector and the S&P/ASX 200.