Market Roundup
- Britain's Raab wants right to scrap Irish backstop after three months - media
- All-UK customs Brxt deal report 'speculation' -PM May's office
- Trump, Obama tout clashing visions of U.S. as elections near
- Kuroda concedes BOJ's easy policy hurting banks, but rules out rate hike
- China's Xi Jinping promises lower tariffs, more imports
- Minority Australian government confirmed as critical by-election result announced
- China Caixin Services PMI, 50.8, 53.1 prev
- Japan Services PMI, 52.4, 50.2 prev
Economic Data Ahead
- (0530 ET/0930 GMT) EZ Sentix Index, 10.1 f'cast, 11.4 prev
- (0530 ET/0930 GMT) Great Britain Markit/CIPS Serv PMI, 53.3 f'cast, 53.9 prev
Key Events Ahead
- N/A ECB’S Coeure and Nouy speak in Brussels
- (0900 ET/1300 GMT) ECB Vice President Guindos speaks at Brussels
- (0910 ET/1310 GMT) Bank of Canada Governor Poloz speaks in London
- (1000 ET/1400 GMT) Euro Zone finance ministers convene in Brussels
FX Beat
DXY: The dollar index steadied after easing to an over 1-week low in the previous session, following China's President Xi Jinping comments,, citing that China will lower import tariffs and continue to broaden market access. The greenback against a basket of currencies trades flat at 96.50, having touched a low of 95.99 on Friday, its lowest since October 24. FxWirePro's Hourly Dollar Strength Index stood at -52.56 (Bearish) by 0500 GMT.
EUR/USD: The euro consolidated within narrow ranges, as investors expect the European Central Bank to lower its growth forecasts at its December policy meeting. The European currency traded flat at 1.1387, having touched a low of 1.1302 on Wednesday, its lowest since August 15. FxWirePro's Hourly Euro Strength Index stood at 67.31 (Bullish) by 0500 GMT. Investors’ attention will remain on series of data from the Eurozone economies, ahead the U.S. service PMI from both the Markit and ISM. Immediate resistance is located at 1.1432 (October 25 High), a break above targets 1.1476 (October 24 High). On the downside, support is seen at 1.1372 (5-DMA), a break below could drag it till 1.1302 (October 31 Low).
USD/JPY: The dollar rose, extending previous session gains, as investors shift focus back to expectations for tighter U.S. monetary policy following stronger-than-expected economic data late last week. The major was trading 0.05 percent up at 113.22, having hit a high of 113.38 on Wednesday, its highest since October 9. FxWirePro's Hourly Yen Strength Index stood at -157.11 (Highly Bearish) by 0500 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. service PMI from both the Markit and ISM. Immediate resistance is located at 113.71 (September 28 High), a break above targets 114.10 (October 5 High). On the downside, support is seen at 112.35 (October 22 Low), a break below could take it lower 112.01 (October 17 Low).
GBP/USD: Sterling held gains near a 2-week peak on growing hopes of a smooth Brexit. The major found support after a Sunday Times report that an all-UK customs deal will be written into the agreement governing Britain's withdrawal from the European Union. The pair traded 0.2 percent up at 1.2985, having hit a low of 1.2695 on Tuesday; it’s lowest since August 16. FxWirePro's Hourly Sterling Strength Index stood at 88.05 (Slightly Bullish) 0500 GMT. Investors attention will remain on UK Markit service PMI, ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.3103 (October 19 High), a break above could take it near 1.3192 (October 17 High). On the downside, support is seen at 1.2936 (October 23 Low), a break below targets 1.2867 (October 24 Low). Against the euro, the pound was trading 0.1 percent up at 87.68 pence, having hit a high of 87.41, it’s highest since October 11.
AUD/USD: The Australian dollar declined from more than 1-month highs ahead of the Reserve Bank of Australia meeting on Tuesday, where it is widely expected to keep interest rates unchanged at 1.50 percent for the 27 consecutive policy meetings. The Aussie trades 0.1 percent down at 0.7192, having hit a high of 0.7258 on Friday; it’s highest since September 27. FxWirePro's Hourly Aussie Strength Index stood at 90.95 (Slightly Bullish) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7164 (October 13 Low), a break below targets 0.7112 (October 16 Low). On the upside, resistance is located at 0.7275 (September 19 High)., a break above could take it near 0.7300.
NZD/USD: The New Zealand dollar eased from recent peaks, as the Reserve Bank of New Zealand is seen as all but certain to hold its policy rate at a record low 1.75 percent at its meeting on Thursday. The Kiwi trades 0.1 percent down at 0.6639, having touched a high of 0.6689 on Friday, its highest level since September 26. FxWirePro's Hourly Kiwi Strength Index was at 132.54 (Highly Bullish) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6727 (August 28 High), a break above could take it near 0.6750. On the downside, support is seen at 6599 (October 1 Low), a break below could drag it below 6560.
Equities Recap
Asian shares slumped, weighed down by concerns of faster rate hikes in the United States and uncertainty around the U.S.-China trade war.
MSCI's broadest index of Asia-Pacific shares outside Japan dropped 1.8 percent.
Tokyo's Nikkei declined 1.4 percent to 21,946.33 points, Australia's S&P/ASX 200 index slumped 0.5 percent to 5,818.10 points and South Korea's KOSPI plunged 1.3 percent to 2,068.99 points.
Shanghai composite index fell 0.9 percent to 2,652.27 points, while CSI300 index traded 1.3 percent down at 3,248.27 points.
Hong Kong’s Hang Seng traded 2.3 percent lower at 25,869.16 points. Taiwan shares shed 0.2 percent to 9,889.81 points.
Commodities Recap
Crude oil prices declined as the start to U.S. sanctions against Iran's fuel exports was softened by waivers that will allow major buyers to temporarily import Iranian crude. International benchmark Brent crude was trading 0.2 percent down at $72.38 per barrel by 0426 GMT, having hit a low of $74.20 on Friday, its lowest since August 21. U.S. West Texas Intermediate was trading 0.3 percent down at $62.67 a barrel, after falling as low as $62.45 earlier, its lowest since April 9.
Gold prices declined as the dollar steadied against a basket of currencies, while investors await the U.S. congressional elections on Tuesday. Spot gold tradig0.5 percent down at $1,232.23 per ounce by 0432 GMT, having touched a low of $1,211.87 on Wednesday, its lowest since Oct. 11. U.S. gold futures was up 0.1 percent at $1,234.6 per ounce.
Treasuries Recap
The Australian government bonds slumped during Asian session on the first trading day of the week ahead of the Reserve Bank of Australia’s (RBA) monetary policy decision, scheduled to be unveiled on November 6 by 03:30GMT. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, jumped 3-1/2 basis points to 2.732 percent, the yield on the long-term 30-year bond surged 5 basis points to 3.254 percent and the yield on short-term 2-year traded nearly flat at 2.050 percent.
THe New Zealand government bonds eased, sending yields about 5 basis points higher at the longer-end of the curve.
