Market Brief: ASX 200 Retreat, Asian Markets Mixed Ahead of U.S. Jobless Claims

Asian markets consolidate for the second time to recent highs amid mixed signals from global economies. The excess liquidity pumped by central banks around the globe helps stocks but weak economic data, on the other hand, questions the recent rally.

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The April Fed meeting Minutes released yesterday reaffirmed the scenario to keep interest rates close to zero until the U.S. economy is on track to recovery.

Rising cases in South America and some Asian nations keep the fears for a second wave of the deadly virus. Mixed headlines from the vaccine and treatment of coronavirus also weigh on stocks.

Investors focus will be on U.S. jobless claims due at 8:30EST with consensus at 2.35 million people filed for unemployment benefits in the week May 16. The businesses conditions in the Philadelphia area, the Philadelphia Fed index, are also due at the same time. Flash PMIs and a report on existing home sales for April are expected later on the day.

Nikkei 225 ended 0.21% lower at 20,552. The Hang Seng Index is 0.35% lower at 24,313. The Shanghai Composite index is 0.48% lower at 2,870. The FTSE Straits Times index in Singapore is 0.01% lower at 2,561. In Australia, the ASX 200 managed to reverse heavy losses and now is 0.17% lower at 5,550.

Crude oil prices continue higher, with gains over 30% in the last week as U.S. oil inventories have fallen in the past week while stock at a major US delivery hub has also fallen.

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ASX 200 Rallies Retreat From Two Month Highs

ASX 200 is 0.41% lower at 5,550 despite a positive start, halting five straight days of gains that drove the index up to two-month highs. Energy stocks continue higher as crude oil price adds over 2% for one more day.

Australia Manufacturing PMI came in at 42.8, below the forecasts of 46.5 in May, while the Services PMI rise to 25.5 from previous 19.5. The Composite PMI rose from previous 21.7 to 26.4 in May. 

On the downside, first support for the ASX 200 index stands at 5,545 the daily low. In case of a move lower, bears might test the next support area at 5,455 the low from May 19 trading session. Next support for ASX 200 on the downside will be met at 5,269 the 50-day moving average.  

On the other hand, immediate resistance for ASX 200 stands at 5,610 the daily top. The next hurdle is at 5,730 the high from March 12. On the move higher, bulls will be looking for an extension to 6,061 the 100-day moving average.  

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