Weaker economic data and no news on a trade agreement is driving a global rally in bonds and gold. European shares traded lower over night, but US investors ignored the clear market signs of deteriorating sentiment. Industrial commodities kept time with bonds, edging lower. Foreign exchange and cryptocurrency markets are stuck in the headlights of these conflicting moves.

Yesterday’s disappointments on Japan GDP and China industrial production and retail sales echoed through overnight trading. UK retail sales and US jobless claims delivered weaker than expected numbers. Slightly better than forecast German GDP and higher French inflation had little impact, as both are still at or near their lower bounds. Stronger US producer prices added to concerns.

The potential for data releases to determine market action remains. Industrial production numbers in Japan come ahead of US trade, retail sales and industrial production tonight.

No news on trade negotiations is becoming bad news. The absence of a substantial trade agreement between China and the US is an increasing drag on market sentiment. This means markets are particularly headline and tweet sensitive.

Opening indications for the Asia Pacific region lean towards caution. Becalmed currencies offer few clues. The Hang Seng is in focus. President Xi called for an end to violence, and a positive response from protestors could ease recent pressure on Hong Kong shares.

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