That no market is immune to a trade war or its spillover effects
Equity futures were a little jittery earlier but commodity currencies held up rather well and safe haven currencies were showing no interest. It sure was puzzling. That is until the retaliatory measures by China were announced.
The market has quickly turned on its head and the aussie went from being the second best performer on the day to the last. While the loonie has also slipped behind the rest of the major bloc too.
The kiwi is still holding onto earlier gains, but has fallen by almost 20 pips from the highs. Meanwhile, the yen and the swissie are proving to be the biggest gainers after the announcement by China.
USD/JPY is threatening a break below 106.00 now, while the swissie has surpassed the euro and sterling in terms of the day's performance.
S&P 500 futures are down by more than 1% now, same goes for Dow and Nasdaq futures. Meanwhile, US yields are down to the day's lows with the 10-year yields falling 3 bps from the highs to 2.75%.
The market is risk-off now, that's for sure. And currency traders finally listened.
