Equities

Asian stock markets closed higher as investors watched the impact of China’s energy crisis on markets and economic recovery in the region.

Meanwhile, New Zealand Prime Minister Jacinda Ardern announced that Auckland would continue to be in COVID-19 lockdown at level 3 after the country saw a surge in infection cases over the weekend.

ASX 200 (-0.3%), driven by declines in the technology sector and consumer stocks. Meanwhile, Star Entertainment suffered a loss of more than 20% after the company was suspected of involvement in money laundering, criminal activity, and fraud. However, the company has denied the allegations.

The Nikkei 225 (+1.5%), erased early losses as exporters were relieved by the recent weakness of the JPY and the government amassed more than JPY 100 billion in financial support for the construction of a chip plant.

Hang Seng (+2.0%) and Shanghai Composite (+0.4%), after talks between Chinese Vice Prime Minister Liu He and U.S. Trade Representative Katherine Tai on Saturday, in which China said it had negotiated tariff cancellations and sanctions.

Commodities

WTI crude futures soared above the $ 80 a barrel level amid rising demand. The crude oil market has been driven by substitution effects amid rising natural gas prices and when OPEC+ decided earlier in the week to adhere to a crude oil production quota of 400K barrels per day planned for November, despite pressure from several countries including the US and India to adding more supply to stabilize prices.

Meanwhile, the price of gold traded around $ 1,755 after failing to maintain gains at the $ 1,780 level after a weak US jobs report. This is because the price of gold is being pressured by an increase in US Treasury yields.

Forex

The US dollar traded steady on Monday with the DXY index hovering around 94.10 despite the United States having posted a weak jobs report on Friday. The U.S. economy only added as many as 194K jobs in September, weaker than forecast. However, the Fed is seen to continue tapering as early as this November. Investors’ focus is now shifting to the US inflation report, scheduled for this Wednesday.

Safe-haven currencies (JPY & CHF) eased, while high-beta currencies (AUD & NZD) strengthened amid positive market sentiment after talks between Chinese Vice Prime Minister Liu He and US Trade Representative Katherine Tai on Saturday, which China says it has negotiated on tariff repeal and sanctions.

Meanwhile, the CAD, commodity-linked currency continued to rise after crude oil prices hit a 7-year high of $ 80.31 on Monday.