Asia Pacific investors are facing mixed leads after confusing trading on Friday night. Industrial commodities rose, but so did gold. European shares fell and bonds came under pressure, but US stocks rose and bonds rallied. Despite the appetite for US assets the US dollar fell. Futures markets are pointing to a modestly positive start to the trading week, but the mixed global performance suggests sentiment could swing sharply.

The APEC conference in Papua New Guinea ended poorly. After both US vice-president Pence and China’s president Xi criticised policies of their global counterparts the nations of APEC were unable to agree on a final statement. Investors may fear that global tensions are on the rise, with a particular focus on the Pacific region.

Further concerns are raised around a potential conflict centring on Saudi Arabia as US intelligence agencies painted the White House into a diplomatic corner. Oil traders are paying close attention.

Trading could be skittish and light given the market concerns. Increasing volatility across all asset classes is pointing to potential major moves. The economic calendar is lighter this week, but includes US durable good, Japanese inflation and German GDP. Strengthening local currencies may also restrain any investor enthusiasm.

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