by Nicholas Cork
The risk-off theme continued overnight after a brief respite in the London session that had allowed the AUD to gravitate back towards the 0.7150 (new) resistance level, before the DOW opened softly and the selling began. Talk that Trump will not sign a funding bill, which potentially puts part of the federal government into partial shutdown, accelerated the equity sell-off and by session close the Nasdaq was on the cusp of a bear market as it sits 20% below its highs in August, and notably will be the first losing year since 2011. Technology stocks have been at the forefront of the equity rally over the past decade and they are now leading the decline. Of the S+P 500, 300 of the stocks are in bear market territory.
AUDUSD held up reasonably well to be still holding onto 71 cents this morning, but AUDcrosses are bearing the brunt with AUDEUR, AUDJPY and AUDCHF all 5% lower from their Dec highs. In Trade War developments, the US has shifted up a gear as the U.S. Justice Department unveils charges against Chinese nationals for hacking into technology-service providers around the world and several U.S. government agencies, violating a 2015 bilateral agreement of no state-sponsored hacking for economic gain. And note as a first, the head of the Australian Cyber Security has named the Chinese Ministry of State Security as being behind the world-wide hacks, joining Canada and the UK also. We await the response..
Merry Christmas to all the readers
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