Asia shares brace for China data to disappoint By Reuters

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<span>© Reuters. An investor looks at a stock quotation board at a brokerage office in Beijing, China January 3, 2020. REUTERS/Jason Lee/File photo</span><br />
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<p>By Wayne Cole</p>
<p>SYDNEY (Reuters) – Asian shares got off to a subdued start on Monday as markets braced for a raft of Chinese economic data that could well underwhelm, while earnings season picks up steam with Tesla (NASDAQ:) on the docket.</p>
<p>The Chinese economy is forecast to have grown just 0.5% in the second quarter, though the annual pace will be flattered by base effects at a predicted 7.3%. </p>
<p>Retail sales, industrial output and urban investment are all expected to show slowing growth, which is why markets are counting on Beijing to unveil more stimulus measures soon.</p>
<p>Figures out over the weekend showed China’s new home prices were unchanged in June, the weakest result this year. </p>
<p>The risk of even softer outcomes kept MSCI’s broadest index of Asia-Pacific shares outside Japan down 0.2%, though that follows a 5.6% rally last week.</p>
<p> was closed for a holiday, though futures were trading near flat.</p>
<p> and Nasdaq futures were both down 0.2%, but that followed hefty gains last week.</p>
<p>Tesla is the first of the big tech names to report this week, while a busy earnings schedule includes Bank of America (NYSE:), <span itemscope="" itemtype="http://schema.org/Corporation"><span itemprop="name"> Morgan Stanley </span></span> (NYSE:), Goldman Sachs (NYSE:) and Netflix (NASDAQ:).</p>
<p>Data on U.S. retail sales are expected to show a rise of 0.3% ex-autos, continuing the slower trend but solid enough to fit into the market’s favoured soft-landing theme.</p>
<p>“We continue to look for a modest contraction to take hold toward the end of the year, but the path to a non-recessionary disinflation is starting to look more plausible,” said Michael Feroli, an economist at JPMorgan (NYSE:).</p>
<p>“We expect Fed officials cheered the latest inflation developments, but declaring victory with sub-4% unemployment, and over 4% core inflation, would be reckless.”</p>
<p>PRICED FOR 2024 POLICY EASING</p>
<p>As a result, markets still imply around a 96% chance of the Fed hiking to 5.25-5.5% this month, but only around a 25% probability of yet a further rise by November.</p>
<p>They have also priced in at least 110 basis points of easing for next year, starting from March, which saw two-year bond yields down 18 basis points last week. </p>
<p>That predicted policy easing is considerably more aggressive than what is priced in for the rest of the developed world, a major reason the U.S. dollar has turned tail.</p>
<p>The dollar has steadied somewhat at 138.75 yen, from a trough of 137.25, but that follows a loss of 2.4% last week. The euro was firm at $1.1223, having also surged 2.4% last week to clear its former top for the year at $1.1096.</p>
<p>Sterling stood at $1.3091, having risen 1.9% last week, with investors anxiously awaiting UK inflation figures later in the week where another high result would add to the risk of further sizable rate hikes.</p>
<p>The hovered at 99.989, after shedding 2.2% last week. </p>
<p>The drop in bond yields was underpinning non-yielding gold at $1,952, after boasting its best week since April. [GOL/]</p>
<p>Oil prices have also been supported by cuts in OPEC supply, seeing crude gain for three weeks in a row before running into profit taking. [O/R]</p>
<p>Early Monday, was off 58 cents at $79.29 a barrel, while fell 55 cents to $74.87. </p>
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<br /><a href="https://www.investing.com/news/stock-market-news/asia-shares-brace-for-china-data-to-disappoint-3126500">Source link </a></p><p>The post <a href="https://forextraderhub.com/asia-shares-brace-for-china-data-to-disappoint-by-reuters.html">Asia shares brace for China data to disappoint By Reuters</a> first appeared on <a href="https://forextraderhub.com">Forex Trader Hub</a>.</p>