Two Ways to Play: Some Chinese Banks Stop Lending
Strengthen your portfolio in good times and bad.
While the US was focused on the special election in Massachusetts last night, Chinese regulators were busy shaking up the markets overseas.
According to the Financial Times, Chinese authorities ordered some large banks to temporarily halt lending due to fears of inflation and growing asset bubbles. Some were even told to stop lending for the rest of January, and one source even reported that Bank of China, one of the most aggressive large lenders, had even switched off its internal electronic loan approval system.
These reports come after China's central bank raised the reserve requirements on all the large banks just last week. The Chinese market responded negatively last night with the Shanghai Composite falling almost 3%.
From the Bull Pen: There are a lot of fundamental concerns of the US Dollar, but objectively looking at the charts, the greenback may be painting a pretty picture. One can look to the bullish dollar fund (UUP), with a sell stop below the recent low ($22.60).
From the Bear Cave: The pattern of lower highs on the China 25 ETF (FXI) continues. First target on the downside could be the 200-DMA at $40. Those playing it can set a buy stop above $43.20.
For more ways to play and other trading ideas from more than 30 top market pros, take a free trial to our Buzz & Banter.
A Quick Check Around the World
Asian trading closed with the Nikkei -0.25%, India -0.07%, Hang Seng -1.81%, Shanghai -2.93%, and Taiwan -0.34%.
Across the pond, we see the FTSE -0.39%, CAC -0.38%, DAX -0.24%
As of 8:10 AM EST, S&P Futures are trading -6.00 to 1140.00. Nasdaq futures are -7.75 to 1882.00.
A Look at Commodities
Over in commodities, crude oil is -1.06 to 78.26 while gold is -9.900 to 1130.10 this morning. Silver is -0.215 to 18.585 and copper -0.4300 to 3.4030.
The dollar Index is +0.6850 to 78.3350.
On the Radar
08:30 Building Permits 585k cons.
08:30 Core PPI 0.2% cons.
08:30 Housing Starts 580k cons.
08:30 PPI 0.0% cons.
10:30 Crude Inventories
Click here for the full trading radar.
It's already hump day! Good luck!
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