Market Talk – Tuesday, Jan. 21

ASIA:

Many business leaders at the World Economic Forum raised concerns over whether the latest round of trade negotiations between China and the US will result in a “phase two” deal before the end of President Donald’s first term. The biggest roadblocks that leaders identified for the phase two deal are US tariffs on Chinese goods and China’s pledge to buy more American products. A phase two deal is expected to lead to a rollback of billions of dollars of tariffs that the US first slapped on China in 2018.

Uber has announced it will sell its food delivery service in India to local rival Zomato. Uber will get a 9.99% stake in the Indian start-up, helping it maintain its presence in the sector. It will be interesting to watch in coming days if this acquisition will cause lay-offs when all UberEats Customers in India will be redirected to Zomato. The deal is likely to give Zomato an edge over its rival Swiggy in a fast-growing but fiercely-contested sector.

India’s much lower than expected GDP numbers are the single biggest drag on its global growth forecast for two years, IMF Chief economist Gita Gopinath said at the WEF summit in Davos. The IMF chief also said that India was primarily responsible for the downgrade in global growth as the IMF cut global growth forecasts due to the economic slowdown in India and other emerging markets. The IMF has projected global growth at a rate of 2.9% for 2019 and 3.3% for 2020, which is 0.1% lower than October estimates.

Nikkei Asian Review reported that All Nippon Airways (ANA) and Singapore Airlines may announce a new joint venture as early as this month, with the partnership going live in 2021. This joint venture would cover flights within Asia. This would be All Nippon Airways’ third joint venture, after their joint ventures with United (to the US) and Lufthansa (to Germany). ANA & Singapore wouldn’t be the first Japanese & Southeast Asia airlines to link. Japan Airlines and Malaysia Airlines entered a joint venture recently, which geographically is similar.

The major Asian stock markets had a negative day today:

  • Shanghai decreased 43.65 points or -1.41% to 3,052.14
  • Kospi decreased 22.95 points or 1.01% to 2,239.69
  • ASX 200 decreased 13.20 points or -0.19% to 7,066.30
  • NIKKEI 225 decreased 218.95 points or -0.91% to 23,864.56
  • Hang Seng decreased 810.58 points or -2.81% to 27,985.33
  • SENSEX decreased 205.10 points or -0.49% to 41,323.81

The major Asian currency markets had a mixed day today:

  • AUDUSD decreased 0.0032 or -0.47% to 0.6845
  • NZDUSD decreased 0.0015 or -0.23% to 0.6594
  • USDJPY decreased 0.35 or -0.32% to 109.82
  • USDCNY increased 0.04019 or 0.59% to 6.90759
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