Commodity outlook worsens from soft Chinese data

Chinese trade data disappointed again overnight , with imports falling for the 13th consecutive month and exports falling for the 5th time in a row. The slowdown in the world’s second largest economy appears to be continuing to worsen.

Three weeks ago President Xi warned that China faces considerable downward pressure and the consistent under performance in commodities has been acting as another red flag . Currency commodities such as the Aussie dollar and global stock markets have seemingly been marching on unabated of late, however maybe now the markets maybe starting to take notice.
As we picked up on earlier, a note from Morgan Stanley highlights two alternative ways that low commodity prices could weigh on stocks .

The vast majority of commodities are trading deep in the red with oil touching prices not seen since February 2009  and Iron ore hitting a 7th consecutive day of making 8 year lows . Gold is a stand out commodity in that it’s trading higher, possibly attributable to safe haven flows as some fear creeps back into markets as we pointed out in the currency space earlier.