An investor looks at computer screens showing stock information at a brokerage house in Shanghai.
Jamie McGeever has given a look at the day ahead in Asian markets based on Reuters -- A look at the day ahead.
The dollar is climbing to a fresh 20 year high, as evidenced by another decline on Wall Street, and a sell off of UK government debt, the squeeze on global markets and investor confidence around the world shows little signs of easing.
The Nasdaq fell for a seventh straight session on Tuesday, its longest losing streak since 2016 and is expected to subdue Asian markets early on Wednesday.
It is a backdrop against which investors will get a lot of key Chinese economic indicators and second quarter GDP figures from Australia.
In August, China is expected to report a slowing of import and export growth, leading to a smaller trade surplus of $92.7 billion. The country's FX reserves are expected to decline in the month to $3.079 trillion.
The health of China's economy is a concern for Beijing and the world. The PBOC said it would reduce the amount of FX reserves that financial institutions must hold in order to slow down the yuan's decline, and hit at a two-year low on Tuesday close to 7.00 per dollar.
The Asian FX spotlight is shining even more brightly on the Japanese yen, which has sunk to a fresh 24 year low of 143.00 per dollar. A test of 150.00 appears likely as the U.S. Japanese yield spreads widen, and the dollar yen is eyeing its best year since the era of free-floating exchange rates began in 1971.
Economists believe that Australia's economic growth will accelerate in the second quarter, and a decent 3% fall in oil prices on Tuesday could help soothe sentiment. Key developments that should give more direction to markets on Wednesday: