Article / 29 March 2018 at 2:14 GMT

Morning Report APAC: Asia mixed as tech fears swell

APAC Sales Trading Desk / Saxo Capital Markets


  • Asian stocks mixed as volatility rules amid fears in megacap US tech shares
  • Equities rose in Japan, though hesitant as JPY recovers from overnight hit
  • Australia’s S&P/ASX 200 Index fell 0.3% while Kospi index was little changed

By Saxo APAC Sales Trading

Economic data of the day (Singapore Time)





0100:US – FED’s Harker speaks on the economic outlook

Overnight news

Trump is after Amazon: The Nasdaq suffered overnight 0.85% and Amazon in particular dropped 1.2% overnight and 9% in two days on reports that Trump wants to go after Amazon.

He doesn’t seem to care much about Facebook as he sees it as a great tool to reach his audience.

However, he believes that Amazon gets a too favourable tax treatment, destroys old style businesses such are shops in malls and commercial real estate by association. He also has the wrong idea that the Post Office is losing money on Amazon which is not true.
Market reaction:
As a result it was a choppy US session in equities.

The US treasury curve is flattening a lot with 2s10s trading now at 49 bps, the lowest level since 2007 and 2s5s at 31 bps.

The 10-year yield has confirmed a close below 2.80% and is suggesting a move to 2.60%.

Oil was volatile and dropped initially following the inventories data which came at +1.64 Mio barrels Vs +0.85 Mio expected and rallied back on talks that IOPEC is discussing extension of oil cuts into 2019.

Trade war: US trade adviser Navarro confirmed a US/South Korea trade deal: "An agreement is being finalised on robust provisions to prohibit competitive devaluation and exchange rate manipulation in order to promote a level playing field for trade and investment. Strong commitments on transparency and accountability are included in the provisions."
Strong US GDP:
US GDP came in higher than expected at 2.9% annualized QoQ against 2.7% expected (previous was 2.5%). Consumption trends continue to be strong. Consumer spending grew 4% revised from 3.8%.

Foreign exchange



Month-end, Quarter-end flows have started early with the holidays coming up pushing the USD significantly higher against all G10 currencies.

USDJPY: Month-end flows pushed the pair much higher overnight and triggered stops in the Hedge Funds space who have been selling on the break of 106.

EURUSD remains in a range 1.2200/1.2550 and dropped overnight following the broad USD buying. Difficult day for NOK which suffered from weaker than expected retail sales (-0.6 vs +0.5% expected).

EURNOK has squeezed higher close to the resistance at 9.7000 and close to the 100d MA at 9.6870.

Despite a good retail sales number in Sweden at 0.3% MoM and 1.5 YoY, USDSEK is reaching new highs for the year at 8.3570.

AUD is reaching a fresh YTD low at 0.7653. The next support is at 0.7600 and it looks like there is room to move back to 0.7500 as the positioning is not extreme for the downside. There has been no bounce since 0.7740

Emerging Markets: USDMXN is collapsing literally since Mid-March and tried to break the January lows. Positive Nafta news, great carry (5.5% in 1 year) are explaining the big drop lower. 

Foreign exchange movements

We are seeing interesting flows in USDJPY: buyers of 111 to 112 strikes for June to August expiries.

There are buyers also from Real Money of 1 yr USDCNH calls 7.50 strike as a hedge against a market meltdown and good levels in spot and vol to enter the trade.




US treasuries felt some pressures overnight from slightly disappointing 7y sale, and also from risk waning risk-off demand. One thing we should pay attention is the 2y10y spread is now within 50pips, first time since GFC.

Bunds paired early gains with technical play dominated later session trading as yields touched 200DMA. Peripherals outperformed led by Italy, amid strong demand and strong pricing in 5y issue.





Dow (-9 points) and S&P 500 ( -7 points) were lower as technology stocks failed to recover from steep losses seen in the previous session. Indices struggled to find direction Wednesday, ending the choppy day of trading with a loss for the second straight day.

Amazon (AMZN) has long been a target of Trump, who has tweeted in the past that the online retailer didn't pay enough taxes or needed to pay the US post office more for handling shipments.

Amazon CEO Jeff Bezos also personally owns The Washington Post, which Trump has labeled "fake news" when unfavorable stories are written about him or his administration. Shares in the e-commerce giant fell $65.63, or 4.4%, to $1,431.42.

Shares of Walgreens (WBA) gained 2.5% after the largest U.S. drugstore chain reported quarterly earnings and revenue that came in ahead of analysts' forecasts.

The stock rose $1.63 to $67.59. Investors also bid up shares in CVS Health, which climbed $2.11, or 3.5%, to $62.71.

Tesla (TSLA) tumbled 7.7 % after Moody's downgraded the electric car maker's credit rating.

The move piles more pain on Tesla, whose stock has been pummelled by news that authorities will investigate a fatal crash that involved a Tesla electric SUV equipped with a semi-autonomous control system. The stock lost $21.40 to $257.78.

Europe: European stock markets closed mixed Wednesday, with investor sentiment dampened by sharp falls in the technology sector, as gains for healthcare shares led by biopharma company Shire PLC helped offset losses in the battered tech sector. UK's FTSE up 44 points and Germany's Dax closed negative 30 points.

Shire (SHP) surged to the top of the index despite a Tokyo court rejecting the pharmaceutical giant's claim against a rival group's drug.

A Japanese court ruled Shire's claim against Swiss drugmaker Roche's new Hemlibra hemophilia medicine should be.

The decision is thought to help clear up any legal uncertainty over the prospective blockbuster medicine. Shares of Shire finished up 14% to GBp 3500 on the news.

Oil producers BP and Royal Dutch Shell fell 0.8% and 1% respectively as oil prices declined and retreated back later of the day. Share price closes at GBP 471.40 and GBP 2,285.00.

Hong Kong: Hang Seng Index (HSI) retreated from its 2 consecutive rise, HSI was down 280 point at opening session, and widened its losses after mid-day. At close, it sank 768 points / 2.5% to 30,022.

Blue-chippers broadly suffered losses. Tencent (700.HK) plummeted 4.6% to $412.2, dragging HSI by 140 points.

Accordingly to HKEX disclosure, President Lau Chi Ping sold 1 million shares yesterday (27 March), in an aggregate amount of approximately $434 million.

HKEX (388.HK) and Ping An (2318.HK) dived below 100MA of $260.7 and $83.15 respectively.

After midday, they last traded at $255.2 and $80.15 respectively, down 2.9% and 3.7%.

Four major blue-chip Chinese banks dropped between 1%-1.7% CCB (939.HK) was under larger selling pressure, last printed at $8.04, which broke its 50 DMA of 8.374.

 Trump seems to think this is the one big tech company he can attack. Photo: Shutterstock

– Edited by Adam Courtenay

This report was compiled by the Saxo APAC Sales trading team in Singapore – the home of social trading. Follow the team on @SaxoStrats or post your comment below to engage with Saxo Bank's social trading platform. Follow us on @SaxoStrats on Twitter

All material contained herein is provided for your general information. The information and commentaries are not intended to be and do not constitute financial advice, investment advice, trading advice or any other advice or recommendation of any sort offered or endorsed by Saxo Capital Markets Pte. Ltd. (“SCM SG”). Any expression of opinion (which may be subject to change without notice) is personal to the presenter and/or author; they do not reflect the view or opinion of SCM SG or its affiliates, neither do they constitute an endorsement of SCM SG’s view or analysis of the same.

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments. SCM SG does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment based on any commentaries or information provided here.
For further information, please click here.  

Saxo Capital Markets Pte Ltd ("Saxo Capital Markets") is a licensed subsidiary of Saxo Bank A/S, an online trading and investment specialist. Saxo Capital Markets serves as the APAC headquarters and holds a capital markets services licence under the Monetary Authority of Singapore; and a commodity broker licence issued by the International Enterprise Singapore. Clients can trade Forex, CFDs, Stocks, Futures, Options and other derivatives via SaxoWebTrader and SaxoTrader, the leading multi-asset online trading platforms.
Trading risks are magnified by leverage - losses can exceed your deposits. Trade only after you have acknowledged and accepted the risks. You should carefully consider whether trading in leveraged products is appropriate for you based on your financial circumstances. Please consider our Risk Warning and General Business Terms before trading with us. Please see full General Disclaimer.

Thousands of serious traders receive free news and analysis from Saxo Capital Markets each day. Saxo Capital Markets never sends these emails unsolicited; they are sent following acceptance of your membership and subscription request by Saxo Capital Markets at If you do not wish to receive any emails from Saxo Capital Markets in the future, please reply to this email with the word "UNSUBSCRIBE" in the subject header.

Copyright | Disclaimer | Risk Warning | Privacy Policy | Contact Us
Samsung Hub | 3 Church Street | # 30-01 | Singapore 049483
Company No. 200601141M


The Saxo Bank Group entities each provide execution-only service and access to permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on or as a result of the use of the Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. When trading through your contracting Saxo Bank Group entity will be the counterparty to any trading entered into by you. does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of ourtrading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws. Please read our disclaimers:
- Notification on Non-Independent Invetment Research
- Full disclaimer

Check your inbox for a mail from us to fully activate your profile. No mail? Have us re-send your verification mail