{"id":132688,"date":"2018-08-28T08:20:21","date_gmt":"2018-08-28T12:20:21","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=132688"},"modified":"2018-08-28T07:07:14","modified_gmt":"2018-08-28T11:07:14","slug":"equities-rise-dollar-falls-on-u-s-mexico-trade-agreement","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2018\/08\/equities-rise-dollar-falls-on-u-s-mexico-trade-agreement\/","title":{"rendered":"Equities rise & Dollar falls on U.S. \u2013 Mexico trade agreement"},"content":{"rendered":"
August 28, 2018<\/div>
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Article by ForexTime<\/a><\/p>\n

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The trade agreement reached between the U.S. and Mexico made the headlines on Monday. The news sent the S&P 500, the Nasdaq, and the Russell 2000 to new record highs. The Dow Jones Industrial average broke above 26,000 for the first time since February and is currently 567 points away from its January record high.<\/p>\n

The U.S. \u2013 Mexico deal seemed to boost confidence that the trade war is moving closer to an end, and the next question is who\u2019s next to close a deal with Trump? Global trade tensions have undoubtedly been the most significant source of risk in 2018. It led to massive falls in emerging market currencies and sent Chinese equities into a bear market after $2 trillion were wiped off their value.<\/p>\n

Although investors finally see the light at the end of the dark tunnel, when it comes to China the tunnel may prove to be too long with lots of bumps along the way. However, it’s Canada what investors will be watching next.<\/p>\n

The dollar which gave up 2.3% from its 14-months high will continue to retreat lower if Canada manages to secure a similar deal this week. But if negotiations fail there\u2019s a high chance that traders return to king dollar, and the surge in risk appetite will be short-lived.<\/p>\n

Although most Asian stocks traded higher following Monday\u2019s Wall Street performance, mainland China stocks fell back into red territory with Shanghai composite and Shenzhen indices retreating slightly. This suggests that neither the U.S. \u2013 Mexican deal nor PBOC\u2019s efforts to put a floor on the CNY managed to attract investors. The latest announcement by China\u2019s central bank to reintroduce a \u201ccounter cyclical factor\u201d to determine the renminbi\u2019s exchange rate is aimed to stabilize the currency after it fell for nine straight weeks since mid-June. However, with the economy continuing to gradually slow, government pushing for deleveraging, and ongoing trade tensions with the U.S., it’s more likely to see a weaker currency longer term. That\u2019s probably why the PBOC\u2019s move was not enough to encourage investors to buy risk assets.<\/p>\n

The economic calendar is relatively light today, so expect currency traders to continue taking the cue from equities performance and any update on U.S. trade negotiations with Canada.<\/p>\n<\/div>\n<\/div>\n<\/div>\n

Disclaimer:\u00a0<\/strong>The content in this article comprises personal opinions and should not be construed as containing personal and\/or other investment advice and\/or an offer of and\/or solicitation for any transactions in financial instruments and\/or a guarantee and\/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.<\/em><\/p>\n

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\"Forex-Time-Logo\"Article by ForexTime<\/a><\/span><\/strong><\/p>\n

ForexTime Ltd (FXTM)<\/strong> is an award winning international online forex broker regulated by CySEC 185\/12 www.forextime.com<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Article by ForexTime The trade agreement reached between the U.S. and Mexico made the headlines on Monday. The news sent the S&P 500, the Nasdaq, and the Russell 2000 to new record highs. The Dow Jones Industrial average broke above 26,000 for the first time since February and is currently 567 points away from its […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-132688","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/132688","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=132688"}],"version-history":[{"count":2,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/132688\/revisions"}],"predecessor-version":[{"id":132711,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/132688\/revisions\/132711"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=132688"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=132688"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=132688"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}