Market Roundup
• US July durable goods orders rise 4.4% vs 3.3% forecast, -4.2% previous.
• US jobless claims 261k vs 265k forecast, 262k previous; Continued claims 2.145m vs 2.175m previous.
• US Markit composite flash PMI 51.5 vs 51.8 previous; svcs flash PMI 50.9 vs 52 forecast, 51.4 previous.
• Fed Atlanta’s GDPNow pares US Q3 GDP growth view to 3.4% from 3.6% on August 16.
• Fed’s Kaplan: case for hiking rates strengthening, need US fiscal policies to grow workforce, infrastructure spending.
• Fed’s George (Hawk) in Jackson Hole: Fed should hike rates gradually.
• Obama's Asian trade deal (TPP) won't get Senate vote this year-McConnell.
• Oil prices up nearly 1 pct on soft dollar, on speculation that next month's informal meeting between OPEC and other major oil producers could result in production curbs.
• Oil pared gains after Saudi energy minister says does not believe any significant intervention in market needed.
Looking Ahead - Economic Data (GMT)
• 23:30 Japan CPI, Core Nationwide YY Jul forecast -0.4%, -0.40%-previous
• 23:30 Japan CPI, Overall Nationwide* Jul -0.40%- previous
• 23:30 Japan CPI Core Tokyo YY* Aug forecast -0.3%, -0.40%- previous
• 23:30 Japan CPI, Overall Tokyo* Aug -0.40%- previous
Looking Ahead - Events, Other Releases (GMT)
• No Significant Events
Currency Summaries
EUR/USD is likely to find support at 1.1200 levels and currently trading at 1.1278 levels. The pair has made session high at 1.1297 and hit lows at 1.1269 levels. Euro slipped lower against the greenback on Thursday as better than expected US factory data and comments from two Fed officials including Vice Chairman Stanley Fischer and New York Fed President William Dudley prompted investors to raise bets that interest rates will be raised sooner rather than later. U.S. data on Thursday added to the bullish outlook on interest rates, with a 1.6 percent rise in a key measure of U.S. durable goods orders for July and a fall in initial weekly jobless claims. The euro initially rose 0.15 percent against the dollar to $1.1283. But declined to hit low at $1.1270 as investors refrained from making big bets in the single currency.
GBP/USD is supported in the range of 1.3106 levels and currently trading at 1.3189 levels. It reached session high at 1.3209 and hit low at 1.3165 levels. Sterling declined against the greenback on Thursday as investors booked profits and remained on the sidelines ahead of the start of a central bankers' meeting in the mountains of Wyoming that could clarify the path of U.S. interest rate policy. Though it was down half a percent on the day against the dollar, the pound was on track for its best weekly performance in six weeks against the greenback. The pound edged down 0.2 percent to $1.3208, leaving it on track for an almost 1.5 percent weekly gain. Friday's second-quarter GDP data was being eyed for direction - though it only covers a week of the post-EU-referendum period, it should show how the UK economy held up during a time of heightened uncertainty.
USD/CAD is supported at 1.2867 levels and is trading at 1.2921 levels. It has made session high at 1.2938 and hit low at 1.2914 levels. The Canadian dollar edged slightly higher against the U.S. currency on Thursday ahead of the start of a gathering in Jackson Hole, Wyoming, of central bankers from around the world, as higher oil prices offset robust U.S. data. Investors are awaiting clues from Jackson Hole on the U.S. interest rate outlook, with the focus on Friday's keynote speech by Federal Reserve Chair Janet Yellen. U.S. crude oil futures settled 56 cents higher at $47.33 a barrel, although gains were pared after a interview with the Saudi Energy Minister that cast doubts on any OPEC output freeze. The Canadian dollar was last trading at C$1.2917 to the greenback, or 77.36 U.S. cents, slightly stronger than Wednesday's close of C$1.2930, or 77.34 U.S. cents.
AUD/USD is supported around 0.7550 levels and currently trading at 0.7616 levels. It hit session high at 0.7621 and made session lows at 0.7600 levels. The Australian dollar declined against its American peer on Thursday after upbeat U.S. factory data and two more Federal Reserve officials pushed towards the case for a rate hike boosting the greenback. The Australian dollar was last trading at $0.7615. It is mostly unchanged so far this week, trapped in a tight range of $0.7584 to $0.7655. Investors are now looking to Yellen's speech in Jackson Hole, Wyoming, on Friday for insight on the U.S. monetary policy outlook. The antipodean currency has been resilient in the face of domestic interest rate cuts this year due to carry trades where investors borrow at low rates in yen, pounds or euros to buy higher-yielding assets such as the Aussie dollar.
Equities Recap
European equities fell on Thursday, dragged down by weaker miners and drugmakers, with investors cutting their exposure to riskier assets ahead of a key speech by Federal Reserve Chair Janet Yellen on Friday.
UK's benchmark FTSE 100 closed down by 0.3 percent, the pan-European FTSEurofirst 300 ended the day down by 0.74 percent, Germany's Dax ended down by 0.9 percent, France’s CAC finished the day down by 0.7 percent.
U.S. stocks wavered and closed lower on Thursday, as investors digested a batch of newly-released economic reports and awaited a key speech from U.S. Federal Reserve's Chair Janet Yellen.
Dow Jones closed down by 0.17 percent, S&P 500 ended down by 0.13 percent, Nasdaq finished the day down by 0.9 percent.
Treasuries Recap
U.S. Treasury yields ended higher on Thursday after the government saw reduced demand for a sale of new seven-year notes, ahead of a highly anticipated speech by Federal Reserve Chair Janet Yellen on Friday.
Benchmark 10-year notes fell 5/32 in price to yield 1.58 percent, up from 1.56 percent late on Wednesday.
Commodities Recap
Gold hit four-week lows on Thursday, under pressure from upbeat U.S. data in the run-up to a speech by Federal Reserve Chair Janet Yellen this week that will be watched for clues on monetary policy.
Spot gold was down 0.1 percent at $1,322.26 an ounce by 2:25 p.m. EDT (1825 GMT), while U.S. gold futures for December delivery settled down 0.4 percent at $1,324.60.
Oil prices rose 1 percent on Thursday on U.S.-Iran military tensions in the Gulf and speculation the dollar will fall on a monetary policy speech due from the U.S. Federal Reserve chair.
Brent crude futures settled up 62 cents, or 1.3 percent, at $49.67 a barrel. U.S. crude's West Texas Intermediate (WTI) futures rose 56 cents, or 1.2 percent, to settle at $47.33.
