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Asia Roundup: Antipodeans slumps on weaker than expected Chinese manufacturing PMI, dollar hits 11-day low against yen as Trump's ex-campaign manager faces charges, investors await BoJ Governor Kuroda's presser - Tuesday, October 31st, 2017

Market Roundup

  • BoJ leave policy as is, ultra-easy, Kataoka dissents on YCC, for more ease?
     
  • Japan Economy expanding moderately, inflation remains weak currently
     
  • BoJ Forecasts – GDP FY ’17/18 +1.9%, ‘18/19 +1.4%, ‘19/20 +0.7%
     
  • BoJ Forecasts – CPI FY ‘17/18 +0.8%, ‘18/19 +1.4%, ‘19/20 +1.8%
     
  • Japan Sept industrial output -1.1% m/m, -1.5% eyed, Oct/Nov +4.7%/-0.9% eyed
     
  • Japan Fall in production in September most in four months
     
  • Japan Sept household spending +0.4% m/m, -0.3% y/y, +0.1% and +0.7% eyed
     
  • Japan Sept unemployment 2.8%, jobs-applicants ratio 1.52, both unch, 1.53 eyed
     
  • Japan fund managers up North America stocks, bonds – Rtrs survey
     
  • China Oct NBS Non-Mfg PMI, 54.30 vs 55.40
     
  • China Oct NBS Manufacturing PMI, 51.6 vs 52.4, 52.0 eyed
     
  • China benchmark treasury yields stabilise on PBOC injections
     
  • S. Korea, China seek to mend relations after THAAD fallout
     
  • New Zealand Oct NBNZ Business Outlook Oct -10.1% vs 0.0%, 2-yr low
     
  • New Zealand PM says ban on foreign home buyers to start early 2018
     
  • New Zealand gov't to set out central bank changes in coming weeks - fin min
     
  • U.S. House tangles with top tax issues, bill's timetable in doubt
     
  • Two ex-Trump aides charged in Russia probe, 3rd pleads guilty
     
  • In defeat for Trump, U.S. judge blocks transgender military ban
     
  • Spanish prosecutor accuses sacked Catalan leader of rebellion
     
  • German parties start to find common ground in coalition talks

Economic Data Ahead

  • (0230 ET/0630 GMT) France Q3 GDP Preliminary q/q, forecast 0.5%, last 0.5%
     
  • (0345 ET/0745 GMT) France Sept Consumer Spending m/m, forecast 0.5%, last -0.3%
     
  • (0345 ET/0745 GMT) France Oct CPI (EU Norm) Prelim y/y, forecast 1.1%, last 1.1%
     
  • (0600 ET/1000 GMT) EZ Oct Inflation, Flash y/y, forecast 1.5%, last 1.5%
     
  • (0600 ET/1000 GMT) EZ Oct Infl Ex Food & Enr Flash Oct forecast 1.2%, last 1.3%
     
  • (0600 ET/1000 GMT) EZ Q3 GDP Flash Prelim y/y, q/q, forecast 2.4%, 0.5% vs 2.3%, 0.6%
     
  • (0600 ET/1000 GMT) EZ Sept Unemployment Rate forecast 9.0%, last 9.1%
     

Key Events Ahead

  • N/A - US Fed's FOMC meet on interest rate starts
     
  • (0230 ET/0630 GMT) BoJ Gov Kuroda press conference – Tokyo
     
  • (0530 ET/0930 GMT) Bank of Italy's Visco delivers a speech - Rome
     
  • (1530 ET/1930 GMT) Bank of Canada's Poloz will appear at House of Commons – Ottawa

FX Beat

DXY: The dollar index consolidated within a narrow range on news that investigators probing Russian interference in the 2016 U.S. election had charged President Donald Trump's former campaign manager. The greenback against a basket of currencies traded flat at 94.56, having touched a high of 95.15 on Friday, its highest since July. 20. FxWirePro's Hourly Dollar Strength Index stood at 93.69 (Slightly Bullish) by 0500 GMT.

EUR/USD: The euro slumped as investors cautiously awaited the Eurozone preliminary core CPI, which is seen rising 1.2 percent y/y in October against previous 1.3 percent. While the quarter-on-quarter growth rate is expected to slow down to 0.5 percent from 0.6 percent. The European currency traded 0.2 percent down at 1.1629, having touched a low of 1.1574 on Friday, its lowest since Jul. 20. FxWirePro's Hourly Euro Strength Index stood at -103.37 (Highly Bearish) by 0400 GMT. Investors’ attention will remain on Eurozone gross domestic product, consumer price index and unemployment, ahead of U.S. employment cost index, and Chicago purchasing managers’ index. Immediate resistance is located at 1.1676 (61.8% retracement of 1.1837 and 1.1674), a break above targets 1.1706 (50.0% retrace). On the downside, support is seen at 1.1593 (Previous Session Low), a break below could drag it lower 1.1550.

USD/JPY: The dollar rebounded after falling to an 11-day low below the 113.00 handle earlier in the session on reports that two former aides of U.S. President Donald Trump were charged by federal authorities probing Russian interference in the 2016 election. The major was trading flat at 113.18, having hit a low of 112.98, its lowest since Oct. 20. FxWirePro's Hourly Yen Strength Index stood at 65.52 (Bullish) by 0400 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. employment cost index, and Chicago purchasing managers index for further momentum. Immediate resistance is located at 113.68 (5-DMA), a break above targets 114.40. On the downside, support is seen at 112.88 (21-DMA), a break below could take it near 112.51.

GBP/USD: Sterling eased after rebounding from 3-month low in the previous session on the back of expectations that the Bank of England will raise interest rates for the first time in over a decade on Thursday. The major traded 0.05 percent down at 1.3202, having hit a low of 1.3070 on Friday, its lowest since Oct. 6. FxWirePro's Hourly Sterling Strength Index stood at 108.81 (Highly Bullish) by 0400 GMT. Investors’ focus will remain on U.S. fundamental drivers, amid a lack of economic data from the UK docket. Immediate resistance is located at 1.3230, a break above could take it near 1.3280. On the downside, support is seen at 1.3175 (5-DMA), a break below targets 1.3125. Against the euro, the pound was trading 0.2 percent up at 88.05 pence, having hit a high of 87.93 pence the day before, its highest since Sept. 29.

AUD/USD: The Australian dollar tumbled, reversing most of its previous session gains, after China's official factory PMI showed growth in the manufacturing sector slowed more than expected in October. The Chinese manufacturing PMI fell to 51.6 in October, from 52.4, while the services index eased to 54.3 from 55.4 in September. The Aussie trades 0.1 percent down at 0.7675, having hit a low of 0.7624 on Friday, it’s lowest since Jul. 11. FxWirePro's Hourly Aussie Strength Index stood at -61.42 (Bearish) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7655 (Previous Session Low), a break below targets 0.7620. On the upside, resistance is located at 0.7725 (61.8% retracement of 0.7883 and 0.7625), a break above could take it near 0.7768 (10-DMA).

NZD/USD: The New Zealand dollar declined, extending previous session losses, as foreign investors remained concerned that the new left-leaning Labor Party government would take a hard-line stance on immigration and foreign investment that would shake up the mandate of the Reserve Bank of New Zealand. The Kiwi trades 0.3 percent down at 0.6856, having touched a low of 0.6818 on Friday, its lowest level since May 11. FxWirePro's Hourly Kiwi Strength Index was at -40.99 (Neutral) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6903 (78.6% retracement of 0.7206 and 0.6818), a break above could take it near 0.6970. On the downside, support is seen at 0.6800, a break below could drag it till 0.6780.

Equities Recap

Asian shares consolidated within narrow ranges after data showed China Oct factory growth slowed more than forecast, while the dollar slightly eased as Federal investigators probing Russian interference in the 2016 U.S. election charged Trump's former campaign manager.

MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.2 percent.

Tokyo's Nikkei fell 0.1 percent to 21,991.84 points, Australia's S&P/ASX 200 index declined 0.2 percent to 5,909.00 points and South Korea's KOSPI advanced 0.9 percent to 2,522.34 points.

Shanghai composite index slumped 0.2 percent to 3,380.33 points, while CSI300 index was trading 0.4 percent down at 3,991.69 points.

Hong Kong’s Hang Seng was trading 0.2 percent lower at 28,281.41 points. Taiwan shares added 0.3 percent to 10,793.80 points.

Commodities Recap

Crude oil prices declined on the prospect of rising U.S. shale output, however, a tightening market due to ongoing OPEC-led efforts to cut supplies supported prices. International benchmark Brent crude was trading 0.6 percent down at $60.46 per barrel by 0432 GMT, having hit a high of $60.98 the day before, its highest since Jul. 3. U.S. West Texas Intermediate was trading 0.3 percent lower at $53.91 a barrel, after rising as high as $54.43 the prior day, its highest since Mar. 1.

Gold prices slumped as the dollar held firm ahead of the Federal Reserve two-day policy meeting on Tuesday and Wednesday at which it is expected to leave rates unchanged. Spot gold was trading 0.1 percent down at $1,275.04 per ounce at 0437 GMT, having touched its lowest since Oct. 6 at $1266.67 on Friday. U.S. gold futures for December delivery were little changed at $1,277.30.

Treasuries Recap

The 10-year U.S Treasury yield stood at 2.363 percent lower by 0.007 bps, while 5-year yield was 0.007 bps down at 1.9901 percent.

The Japanese bonds slightly gained after the Bank of Japan cut its inflation growth forecasts for the coming fiscal years, while holding its monetary policy steady, even as its peers in the U.S. and Europe begin to wind down stimulus. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, fell 1/2 basis point to 0.065 percent, the yield on long-term 30-year also slipped 1/2 basis point to 0.867 percent and the yield on short-term 2-year traded nearly 1 basis point lower at -0.158 percent.

The Australian bonds rallied as investors poured into safe-haven assets tracking a similar movement in the U.S. counterpart after Fed Governor Jerome Powell seems to be in the run-up for succeeding Janet Yellen in early February next year. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, fell 5-1/2 basis points to 2.686 percent, the yield on the long-term 30-year note also declined 5-1/2 basis points to 3.453 percent and the yield on short-term 2-year slid 3-1/2 basis points to 1.832 percent .

The Canadian government bond prices were higher across a flatter yield curve in sympathy with U.S. Treasuries. The two-year rose 4 Canadian cents to yield 1.405 percent and the 10-year climbed 26 Canadian cents to yield 1.956 percent, its lowest since Sept. 8.

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December 11 09:00 UTC Released

ITRetail Sales NSA YY

Actual

-2.1 %

Forecast

Previous

3.4 %

December 11 09:00 UTC Released

ITRetail Sales SA MM

Actual

-1 %

Forecast

Previous

0.9 %

December 11 11:30 UTC 113113m

TREndYear CPI Fcst/Cb Svy*

Actual

Forecast

Previous

10.68 %

December 11 15:00 UTC 323323m

USEmployment Trends*

Actual

Forecast

Previous

135.6 tln

December 11 15:00 UTC 323323m

USJOLTS Job Openings*

Actual

Forecast

Previous

6.093 Mln

December 11 21:00 UTC 683683m

KRExport Price Growth YY*

Actual

Forecast

Previous

8 %

December 11 21:00 UTC 683683m

KRImport Price Growth YY*

Actual

Forecast

Previous

6.8 %

December 11 23:50 UTC 853853m

JPCorp Goods Price MM*

Actual

Forecast

Previous

0.3 %

December 11 23:50 UTC 853853m

JPCorp Goods Price YY*

Actual

Forecast

Previous

3.4 %

December 12 00:30 UTC 893893m

AUNAB Business Conditions

Actual

Forecast

Previous

21 Bln TRY

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