Our systems have detected that you are using a computer with an IP address located in the USA.
If you are currently not located in the USA, please click “Continue” in order to access our Website.
Local restrictions - provision of cross-border services
Swissquote Bank Ltd (“Swissquote”) is a bank licensed in Switzerland under the supervision of the Swiss Financial Market Supervisory Authority (FINMA). Swissquote is not authorized as a bank or broker by any US authority (such as the CFTC or SEC) neither is it authorized to disseminate offering and solicitation materials for offshore sales of securities and investment services, to make financial promotion or conduct investment or banking activity in the USA whatsoever.
This website may however contain information about services and products that may be considered by US authorities as an invitation or inducement to engage in investment activity having an effect in the USA.
By clicking “Continue”, you confirm that you have read and understood this legal information and that you access the website on your own initiative and without any solicitation from Swissquote.
Despite Chinese weak trade balance reported this week, Shanghai composite stock have rallied solidly. Sentiment was supported by news that Beijing stated it would reduce taxes 'on a larger scale' to support a slowing economy amid ongoing trade tensions. In addition the offical state planner inidcated that China will achieve "a good start" in 1Q, signalling administrators would announce more stimulus measures to stablize weak economic growth. US-Chinese trade talks ended and optimism about the outcome sent the Chinese yuan higher and the US dollar lower yesterday afternoon. The combination of dovishness by the US Federal Reserve and trade harmony is risk-friendly and dollar-negative, even if Asian equities are threatening to run out of steam. While the USD looks to have peaked, equity valuations still look promising. In the near term, higher-level discussion is planned between China and the USA, possibly on 30-31 January. There is growing expectations that the US will suspend tariffs implemented in 2018 to give China time to announce reforms. A temporary settlement will send global sentiment higher. China’s central bank is not looking for a sharp appreciation, however, significant undervaluations in the Shanghai composite is an opportunity for investors.
Fed Chairman Jerome Powell predicts no recession in 2019 and says the Fed will be patient in interest tightening. His dovish tone supported the risk bounce and broad USD weakness. Traders shrugged off the conflict over the US federal government shutdown. As the S&P 500 nears 2600, a bullish break would signal a reversal of the recent correction.