Currency check: Australian dollar facing ‘perfect storm’, Japanese yen close to intervention levels
The Australian dollar has been facing “something of a perfect storm” since the start of the week, according to Rodrigo Catril, currency strategist at National Australia Bank.
The currency, which is highly sensitive to China’s economic fortunes, lost ground on weak Chinese Purchasing Managers’ Index data and new US rules on chip exports to China. It was last down around 0.6% and is trading at $0.6266.
Chinese onshore and offshore yuan also weakened and last changed hands at 7.19 to the dollar.
Meanwhile, japanese yen weakened against the US dollar to trade at 145.70. This is approaching this year’s low of 145.89 to the dollar, which prompted authorities to intervene in September.
The Japanese currency strengthened to 140 levels after the intervention, but has since weakened significantly.
CNBC Pro: Chinese tech stocks fall, but short sellers have another sector in sight
Chinese tech stocks are down 20% this year, but short sellers are targeting a different sector.
Some $742 million in new bearish bets were placed on a particular Chinese sector in the third quarter. That compares to a cut of about $150 million in shorts on the tech sector.
CNBC Pro subscribers can learn more here.
TSMC shares plunge 7% on US export limits
Business intelligence firm TrendForce wrote that the US rules will affect non-Chinese companies such as TSMC, Samsung and SK Hynix.
“In the future, whether the situation is that American factories are no longer able to export to the Chinese market or that Chinese factories are unable to initiate projects and mass produce wafers, all of this will have a negative impact on the future status of TSMC’s purchase orders. [nanometer] and 5nm,” said a press release on TrendForce’s website.
Shares of Samsung Electronics lost 3.9% and SK Hynix lost 3.5% to session lows.
US Treasury yields climb, 30-years hit highest level since 2013
The yield on the 30-year US treasury bond climbed as high to 3.941%, reaching its highest level in nine years.
The Return over 10 years rose to 3.963% and the Return over 2 years slightly higher at 4.318%. Rates fell earlier this month but started to rise again after positive economic data in the United States led investors to increase their bets on further rate hikes by the Fed.
Bond yields move inversely to prices and one basis point equals 0.01%.
CNBC Pro: Wall Street bullish on some tech corners again as Citi gives stock a 115% upside
Some Wall Street banks have started making the case for new buying in tech, naming specific sectors they are bullish on.
Both Citi and Morgan Stanley said they had upgraded their technology to overweight.
CNBC Pro subscribers can learn more about the areas they research and the global stocks to buy.