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Monday Morning Briefing: Asia Negative, Safe Haven Assets Gain

Here’s your Monday morning briefing

Two Hundred and Fifty Gram Gold Bars (Photographer: Akos Stiller/Bloomberg)
Two Hundred and Fifty Gram Gold Bars (Photographer: Akos Stiller/Bloomberg)

Asian stocks declined on Monday as traders reacted for the first time to Donald Trump’s inauguration. Demand for safe haven assets rose while the U.S. dollar slumped after Bank of Japan Governor Haruhiko Kuroda said that the greenback could strengthen in the Trump presidency.

Oil prices traded above the $53 per barrel mark along with gold, which continued its gaining streak.

Monday Morning Briefing: Asia Negative, Safe Haven Assets Gain

Trump Takes Oath

Donald Trump took oath as the 45th President of the United States of America on Friday. In his inaugural address, Trump promised unapologetic nationalism that would protect U.S. jobs and a foreign policy that would eradicate Islamic terrorism and put the country’s interests ahead of all others.

Monday Morning Briefing: Asia Negative, Safe Haven Assets Gain

Trump enters office with historically low approval ratings of 40 percent, according to Gallup, and a challenge to unite a divided nation. His party and he are already at odds in the congress, especially on the issue of the Russian government’s meddling in the election.

U.S. equity markets ended Friday’s trade on a positive note with the Dow Jones Industrial Average index snapping its 5-day losing streak. The S&P 500 index and the NASDAQ composite index gained 0.3 percent each.

The Bloomberg Dollar Spot index fell 0.3 percent, declining for the fourth week in a row, the most since February. The yen rose 0.7 percent against the greenback.

Commodities Rise

Oil held a two-day rise after members of the OPEC (Organization of Petroleum Exporting Countries) along with other producers agreed on a way to monitor the compliance to the supply cut agreed upon.

Compliance is great, it’s been really fantastic. Based on everything I know, I think it’s been one of the best agreements we’ve had for a long time.
Khalid Al-Falih, Minister Of Energy And Industry, Saudi Arabia

Since the deal taking effect on January 1, producers have cut as much as 1.5 million barrels per day which is more than 80 percent of their total output.

West Texas Intermediate crude was trading little changed at $53.28 per barrel after gaining 2.6 percent in the last two sessions.

Gold gained 0.9 percent to $1,215.50 an ounce, the highest level since February.

Weak Start?

The SGX Nifty index was trading lower by 0.3 percent at 8,350 indicating a weak start to Indian equities. Benchmark indices ended near one-week lows on Friday with the NSE Nifty 50 index failing to hold the 8,350 mark. Shares of Ultratech Cement Ltd. will be in focus after the cement major posted a steady set of numbers in its third quarter on Saturday.