Surprisingly good prospects for some East Asian stock markets
According to analysts from Reuters Polls, Bloomberg and Alpho, the U.S.-Iran tensions easing will lead to developing interest of investors in volatile assets in upcoming weeks. Such a development will result in demand for currencies of Asian upcoming markets, mostly Indian rupee (INR) and South Korean won (KRW).
ASML Holding NV is main semiconductor chip equipment manufacturer. While Taiwan semiconductor import has been developing previous two months, South Korea's semiconductor export fell 17.7% year-on-year in December following its 30, 8% decrease in last month. Nevertheless, the fall was not as low as expected. In terms of volume, however, overseas semiconductor provide grew in 7, 9% in contrast with a year earlier. Peter Wennink, President and CEO of ASML, attended conference in Barcelona in the starting of November 2019, and expressed his expectations on robust demand for semiconductors in 2020 - mainly from logic chip makers.
According to official data, Taiwan's semiconductor devices import grew in November and December in 156, 4%, or more exactly in 158, 6%. Furthermore, South Korea's and Taiwan's import to China and developing industrial manufacturing stabilizes and improves.
Based on attitudes of main central banks (FED, ECB) and first signs of international trade recovery it is a remarkable signal to help export-based currencies mainly referred to KRW and TWD, in accordance to the Alpho analysis. Moreover, released tensions in the US-China trade war support the progress, too.
American president Donald Trump and Iran representatives sign so far they prefer no more military escalation. Middle East tensions easing and partial solution to the US-China trade war may strongly help Asian currencies and stock markets in first half-year period.
Second half-year duration outlook relies upon partly on the US presidential election process, campaign style and chance that Donald Trump defends his mandate. Possibility of Brexit failure, custom duties between the US and EU and second phase of the US-China trade deal negotiations still pose a huge threat for the outlook.
