Asian markets are trading higher on Monday after a positive close in Wall Street on Friday and as President Trump praised the recovery in the coronavirus numbers across the country, which boosts the optimism for the economic restart. Federal Reserve Chairman Jerome Powell now forecasts a steady recovery in the U.S. during the Q2 of 2020 and for one more time rejected the negative rates scenario. He also added that in the medium run, you wouldn’t want to bet against the U.S. economy. News that the Chinese government is preparing plans for a new stimulus to further boost the economy in the annual legislative meetings.
Many analysts expect that the economies will likely bottom out in April as more and more businesses started the reopening in Europe and U.S.A.
Nikkei 225 ended 0.48% higher at 20,133. The Hang Seng Index is 0.40% higher at 23,897. The Shanghai Composite index is 0.63% higher at 2,886. The FTSE Straits Times index in Singapore is 0.78% higher at 2,542. In early European trading, the futures in Wall Street are trading over 1% higher.
Japan Economy Contracts For Second Straight Quarter, Nikkei 225 Higher
Nikkei 225 finished 0.48% higher at 20,133 after the Japan Gross Domestic Product for the first quarter came in at -0.9%, beating the expectations of -1.2%, the annual GDP registered in at -3.4%, also above the expectations of -4.6%. That was the second straight quarter for Japan marking the first recession since 2015. Pressures on the economy existed already in the Q4 of 2019 as the economy absorbed a sales tax hike, while analysts expect that the second quarter would be worse amid the coronavirus lockdown. On the economic data front, Japan Tertiary Industry Index came in at -4.2%, below the forecasts of 0.2% in March.
On the technical side, first resistance for the Nikkei 225 index stands at 20,197 the daily top. The next resistance for the Nikkei index stands at 20,314 the high from May 13. If Nikkei 225 moves above 20,314, the next supply zone is at 20,573 the two-month highs.
On the other side, first support stands at 19,999 today’s low. If the Nikkei 225 index breaks below, then the next support will be met at 19,832 the low from Friday’s trading session. In case of more selling pressure in the index, the next support zone stands at 19,221 the 50-day moving average.