Digest – China’s Ripple‑Wave Hits Markets
What Went Down Yesterday
Picture China tossed its latest financial playbook onto the world stage, and everyone got a little giddy—think of buzzed‑out party‑goers eager to hear the next surprise. The hand‑shaking headlines: the nation’s fiscal playbook will be “more proactive” next year, and the monetary stance will be “moderately loose”—the first official policy tweak since 2011. 6‑month‑long stimulus smokes and a sudden 3% rally in Chinese stocks followed up by a 10% pop in the Nasdaq’s “Golden Dragon” index.
Breakdown in plain list‑form:
- China whispers that it might loosen up.
- Investors start dreaming big.
- Markets go wild.
- Reality falls short.
- Markets sigh and move back down.
- More chatter, repeat.
Why I’m Not… too bullish on China
Honestly, I keep my distance. The policy game is a moving target, and a politburo that’s treating the economy like a soufflé—tightens one minute, crumbles the next—means waves of uncertainty. I’m more drawn to good old US grounds: stable property rights, the voracious “US‑exceptionalism” engine, and the Fed sweetener that’s got folks looking forward to every dollar dip.
FX & Commodities Snapshot
The green‑back dip put the AUD & NZD on the “rise” mic—a 1% lift each—while the GBP refreshed with some buyers before tiring out at 1.28. The dollar index fell past 106, but I stay upbeat, ready to hop on any USD slide.
Gold woke up after a two‑week nap, likely due to China re‑starting purchases after a six‑month break. Yet it nudged against its 50‑day moving average at $2,670/oz. One more break above, and we might see fresh Olympians in the gold market.
Tech Tension: Nvidia Under the Microscope
Turns out, China’s probing Nvidia for possible monopoly breaches—so if you’re in the EU, you might want to check on your own regulator’s inbox. The blowouts: NVDA slid ~3%, losing a whopping $100bn in market value, and the Nasdaq 100 took the hit, urging Wall Street to stand down a bit. That said, the beefed‑up earnings and solid economic footing still make the market a good candidate for buying the dips.
Today’s Quiet Agenda
We’re heading into a quiet day until the US CPI report tomorrow. The docket shows almost no movers: not much on US unit labour costs or a 3‑year Treasury auction, if any at all. Patience is the name of the game until we see the real scoop in the next 24 hours.
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