Asian stocks rise as investors positioning a V-shaped recovery, supported by another positive session in Wall Street. Major U.S. indices managed to finish higher despite the violent protest in many cities across the country. Positive economic data from China also support stocks. The Caixin Services PMI came in at 55, beating the expectations of 50.3 in May. The services sector activity rose for the first time in four months, while the New orders jumped at the fastest pace in a decade, indicating a sharp recovery in certain parts.
Australia’s GDP Shrank By 0.3% In Q1
Australia’s Gross Domestic Product contracted by 0.3% in the first quarter of 2020, matching the expectations. The yearly reading for GDP came in at 1.4% in line with expectations. Australia’s Services PMI came in at 26.9 topping the expectations of 25.5 in May, while the Composite PMI rose to 28.1 from previous 26.4. The Building Permits came in at -1.8%, above the forecasts of -15% in April.
From Japan the Services PMI registered in at 26.5 in May, the April reading was at 21.5
The Nikkei 225 ended 1.29% higher at 22,613. The Hang Seng Index is 1.30% higher at 24,309. The Shanghai Composite index is 0.44% higher at 2,934. The Singapore Straits Times index is 2.18% higher at 2,668. The ASX 200 is 1.03% higher at 5,895.
Brent oil broke above the $40 mark on hopes of more oil production cuts by the OPEC+ countries. WTI crude oil is 2.66% higher at 37.79 per barrel, while the Brent crude oil is 1.74% higher at $40.29.
NZDUSD continues higher for the third consecutive trading session hitting the higher level since March 9 as the optimism around the global recovery helps riskier currencies. Positive economic data from China also supports the Kiwi as China is a major trading partner of New Zealand. The pair breached yesterday above the 200-day moving average, and now bulls are in control. A warning sign for longs is that the RSI is now hovering in overbought levels.
On the downside, initial support stands at 0.6359 the daily low. If the bears continue the pressure, then the next support for NZDUSD will be met at 0.6189 the 100-day moving average. The next support area will be reached at 0.6262 the low from yesterday’s trading session.
On the other hand, intraday resistance for NZDUSD stands at 0.6430 the daily high. A break above would meet the next resistance at 0.6450 the high from March 9. The next obstacle for bulls stands at 0.6490 the February 12 high.