Bank Stocks Bring Down the ASX 200 Today

This morning, Asian markets were rather mixed as they took cues from yesterday’s European trading hours. Concerns over Brexit are reemerging.

In Japan, the Nikkei 225 was down around 0.80 percent in the morning and stocks on the Korean Kospi Composite were also lower. In Hong Kong stocks were also lower but stock exchanges on mainland China were higher for the day.

This morning economic data showed that business activity in China was growing at a faster than expected pace. The Caxin PMI for June came out at 52.7. It printed at 51.2 in May thus showing its fastest increase in nearly a year. Anything above 50 shows expansion.

Federal Elections Weigh on Bank Stocks

In The Down Under, the ASX 200 lost nearly one percent as the heavily weighted financials sub-index fell 1.2 percent. The Big 4 of Australia’s banks were under selling pressure, with NAB down 1.6 percent as continued political uncertainty in Australia is weighing on their future.

Despite this uncertainty, with the failure to reach a majority in the national elections, the Australian Dollar was higher today. It was trading around $0.7508 as f 1030 HK time. The Aussie traded at $0.7438 yesterday, which was not good for bank stocks but good for exporting companies. Investors will continue to watch the political deadlock in Australia after the federal election failed to crown a clear victor. No party has a ruling coalition or the means to form one. This could have a bad effect on the country’s AAA credit rating as time draws out.

Overnight, in Europe, the London FTSE was lower and US stock markets were closed in celebration of the Independence Day holiday. More ramifications of the UK leaving the European Union are beginning to take hold as investors show more signs of trepidation and worry. As of right now, the United Kingdom has yet to enact Article 50 and formally begin divorce proceedings from the EU.