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Asian Markets Slump as Chinese Markets Tank 8%

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Asian and Pacific Rim Markets started the week on the back foot as the equity indices, in China, opened, after a long holiday break.

Chinese equities tumbled more than seven percent at the open on Monday as Asian traders are fleeing into safe haven assets as the Wuhan strain of the coronavirus spreads.

In Hong Kong, the headline Hang Seng index was up 0.59 percent. Shares of Tencent added over two percent and Alibaba gained 1.7 percent.

In Japan, the benchmark Nikkei 225 index was down. Shares fell 0.92 percent. Shares on the broader Topix index, in Tokyo, lost 0.7 percent.

Across the Korean Strait, the South Korean Kospi composite index lost 0.23 percent.

Elsewhere in the Asian and Pacific Rim, the Australian S&P ASX saw shares surrendering over 1.2 percent by late morning.

On the mainland, in China, shares on the Shanghai composite are down eight percent. The Shenzhen composite has shed over 7.7 percent and the Shenzhen component has tanked 7.48 percent.

China’s financial markets have reopened after a long holiday break. They were closed last week for the Luna New Year celebrations. The coronavirus continues to spread and over three hundred have died.

According to the private Caixin survey, for the month of January, factory orders stalled as export orders fell. The markets expected a big fall lower thanks to the coronavirus.

Asian Sentiment continues to sour over the Coronavirus

Regional traders in Asia are now watching political tensions in Hong Kong, one again, as medical workers will go on strike today if the City does not shut its borders with mainland China.

This strike will include up to 3,000 at first. This strike will go into effect at 6 pm Hong Kong time if the City’s government does not respond to their demands. An additional 3,000 city workers will also join the strike on Tuesday. This will bring the total to six thousand.

About David Frank

David has his MA and PhD in Economics. He is a technical analyst who has been trading in the Forex world for over a decade. As an analyst and trader, David believes in the big picture by blending together technical analysis with the fundamentals behind the scenes in the Forex and Bond markets. David’s trading strategy is unique. He blends an understanding of fundamental and macroeconomics with technical analysis to offer a unique view into Forex. He applies several strategies including carry long positions, to take advantage of high yields in non-volatile markets, as well as using quicker, chart related analysis for day trading.

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