Market Brief: Asian Shares Mixed, AUDUSD At Monthly Highs

Summary:
• Asian markets trading mixed on Wednesday as President Donald Trump signed a bill that would penalize banks doing business with Chinese officials who

Asian markets trading mixed on Wednesday as President Donald Trump signed a bill that would penalize banks doing business with Chinese officials who implement the new security law. At the same time, China immediately announced that it would impose retaliatory sanctions on U.S. individuals and entities. On the other hand, positive results from early-stage trials for a coronavirus vaccine from Moderna that produced immune responses and no safety issues in 45 participants.

Wall Street ended higher as the first set of banking earnings beat the downgraded forecasts. JPMorgan reported better-than-expected 2Q earnings helped by a 79% increase in trading revenue. The earnings came at $4.69 billion, or $1.38/share, beating the expectations. Revenue came in at $33 billion also above the $30.3 billion estimates. Wells Fargo announced a $2.4 billion loss for the second quarter and cut its dividend to 10 cents per share. Citigroup reported earnings of 50 cents/share, beating the expectations of 0.28 on $19.77 billion of revenue.

Nikkei 225 ended 1.59% higher at 22,945. The Bank of Japan kept interest rates unchanged at -0.1% as was expected by analysts. The Shanghai Composite index is 1.12% lower at 3,376. The Singapore Straits Times index is 1.21% higher at 2,651. Hang Seng is 0.16% lower at 25,437.

AUDUSD At Fresh Monthly Highs

AUDUSD trades 0.33% higher at 0.6998, making fresh monthly highs as the risk-on sentiment boosted risky currencies. News that Moderna’s vaccine produced positive results in the initial trials offset the worries of rising new infections in Victoria state which is under lockdown measures for the next six weeks. Australia’s Consumer Confidence dropped to -6.1% in July from the previous 6.3%. 

On the technical side, now the initial resistance for AUDUSD stands at 0.7018 the daily and monthly top. Next hurdle for the pair will be met at 0.7058 the high from June 10 trading session. The next supply zone is at 0.7086 the high from July 19, 2019.

On the flip side, the first support for AUDUSD pair stands at 0.6971 the daily low. Below 0.6971 the next target will be at 0.6923 the low from yesterday’s trading session. Next support zone would emerge at 0.6829 the low from June 30.  

AUDUSD Daily Chart