Key takeaways
- Global equity sell-off returns as markets face renewed pressure and risk sentiment weakens.
- Asian sharemarkets suffer large declines, with the Nikkei down 2.7% and Shanghai index losing 3.0%.
- US equities also drop; the S&P 500 falls 1.2% and Nasdaq loses 2.9%.
- The Aussie and kiwi currencies hit hardest, with AUD/USD and NZD/USD both showing declines.
Global equity sell-off returns
Global equity markets came under renewed pressure overnight as the recent pause in selling ended and risk sentiment weakened again.
Asian sharemarkets led the declines, with the Nikkei down 2.7% and China’s Shanghai index losing 3.0%.
US equities were also weaker overnight. The S&P 500 fell 1.2% while the tech-focused Nasdaq lost 2.9%.
Aussie and kiwi lead losses
In currency markets, the Aussie and kiwi were the hardest hit.
AUD/USD fell 0.1%, with the pair’s move above 0.7000 potentially proving short-lived.
NZD/USD lost 0.2% following a weaker-than-expected New Zealand inflation report.
In Asia, the Japanese yen outperformed as investors favoured safe-haven currencies.
Global PMI numbers in focus
Away from the weakness in equity markets, attention now turns to the latest PMI reports.
The PMI surveys provide one of the most up-to-date readings on global economic activity and will be closely watched for signs that recent market uncertainty is starting to weigh on growth.
Australia leads with its PMI release at 9.00am, followed later by Japan and Europe.
The US numbers will be particularly important after last month’s very strong readings reinforced the story of US economic outperformance.
Getting redder all the time
Table: seven-day rolling currency trends and trading ranges
Key global risk events
Calendar: 19 – 24 October
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*The FX rates published are provided by Convera’s Market Insights team for research purposes only. The rates have a unique source and may not align to any live exchange rates quoted on other sites. They are not an indication of actual buy/sell rates, or a financial offer.
