It’s been a mixed day for Asian equity markets but the stand out winner was the Shanghai Composite where the index jumped 1.5% off the back of fresh stimulus hopes. The driver seems to be in the smallest detail, but with state media reporting that the Bank of China plans to broader the definition of “first time mortgages”, there’s hope that this will stem the recent slide in property sales. What’s more, brokerages are also seeing brisk business pushing their shares higher as speculation builds over that link between the Shanghai and Hong Kong exchanges. Elsewhere in the region the picture has been less compelling – the Hang Seng found its way to post some modest gains but the Nikkei is sliding following a drop in USD/JPY. Comments by Prime Minister Shinzo Abe highlighted the fact he’s not necessarily ready to see the Yen go through a massive devaluation.
Wall Street had a rough ride yesterday and futures are suggesting we might see something of a modest rebound at the open. We have new home sales figures and mortgage application data due for release either side of the opening bell so this could provide some fresh direction but arguably if prospects in Asia are looking a little more upbeat then the positive sentiment can be justified. Ahead of the open we’re calling the DOW up 9 at 17065 and the S&P unchanged at 1983.