Better-than-expected Chinese trade balance figures sent Asian equities into rally mode yesterday.

The country’s exports rebounded 18.7% YoY, and the decline in imports narrowed to 1.7% in yuan terms. These numbers were encouraging as they showed signs of stabilisation after eight months of export contraction. In Singapore, Q1 GDP grew 1.8%, beating expectations of 1.7%.

The Hang Seng Index soared 3.19% to 21,158, its highest level this year. HK-listed Standard Chartered bank (2888 HK) rallied 8.18%. The HK-SH link has registered a 3.56 billion northbound flow, showing an accelerated fund flow into China’s stock market.

The Shanghai Composite ended 1.42% higher. The Nikkei was up 2.84% as USD/JPY has rebounded sharply from its 17-month low. Singapore’s Straits Times Index rallied 75.8 points, or 2.69%, registering its largest one-day gain in more than a year.

SembCorp Marine – a Singapore based ship and rig building company – soared 17% and its trading volume exploded to five times its average daily volume, driven by the rally in crude oil price.

Commodities
WTI crude oil retraced a bit from yesterday’s high, as US DoE crude oil inventories rose by 6.63 million barrels compared to the previous week. The upcoming freeze meeting has likely caused optimism which is already priced. Traders will remain cautious of the possible “sell-on-news” effect next week.

Gold dropped to $1,235 this morning as improved risk appetite reduced the demand for safe-haven assets.

FX
This morning, the Monetary Authority of Singapore decided to move to a zero-  appreciation stance on the Singapore dollar. USD/SGD went up 113 pips to 1.3615. The next resistance level is 1.370 and the immediate support level is 1.350. USD/JPY extended the rebound and hit 109.45 this morning, leading Asian equities to open higher. The next resistances are 110.00 and 111.00.

Hong Kong 50 – Cash

Key technical levels to watch:

  • Still in the up-trend channel
  • Broken above key resistance level of 21,000, next resistance level is 22,128
  • Immediate support level: 20,560

SembCorp Marine

Key technical levels to watch:

  • Still in the up-trend channel
  • 50 SMA is slopping upwards, and becomes immediate support level
  • Immediate resistance level: 1.965

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