Market Roundup
- Prankster, coughing fits mar Theresa May’s speech to activists
- Eastern Europe's nationalists feel vindicated by German vote
- Australia Aug Retail Sales, -0.6% vs 0.0%, forecast 0.3%, revised -0.2%
- Australia Aug Trade Balance (A$), 989 mln vs 808 mln, forecast 875 mln
- New Zealand 'kingmaker' starts coalition talks with National, Labour
- New Zealand's operating surplus higher than expected for this fiscal year
- Poll- Japan stocks to hit 21-year high in 2017 on weak yen, election
Economic Data Ahead
- (0315 ET/0715 GMT) Switzerland Sep CPI, 0.20% m/m, 0.60% y/y eyed; last 0.00%, 0.50%
- (0330 ET/0730 GMT) Sweden Aug Ind Production, 0.10% eyed, last -0.90%
Key Events Ahead
- (0300 ET/0700 GMT) BoE's Cleland speaks in Vienna
- (0415 ET/0815 GMT) ECB's Praet speaks in Frankfurt
- (0530 ET/0930 GMT) Spain E0.750/E3.500/E1.000 bln for 7/5/12 year auctions
- (0550 ET/0950 GMT) France E1.500/ E5.000/E2.000 bln for 8/10/31 years auctions
- (0530 ET/1030 GMT) UK 2.750 bln for 6-year auction
- (0815 ET/1215 GMT) ECB's Coeure speaks in Frankfurt
- (1200 ET/1600 GMT) BoE's McCafferty speaks in London
- (1330 ET/1730 GMT) BoE's Haldane speaks in London
FX Beat
DXY: The dollar rose versus most of its major peers after data released on Wednesday showed U.S. service sector growth hit is fastest in 12 years in September and private employers added more jobs than estimate despite Hurricane Harvey and Irma. The greenback against a basket of currencies traded flat at 93.51, having touched a high of 93.92 on Tuesday, its highest since Aug. 17. FxWirePro's Hourly Dollar Strength Index stood at -5.39 (Neutral) by 0500 GMT.
EUR/USD: The euro slightly edged down after gaining for two consecutive sessions, ahead of the release of the ECB monetary policy meeting minutes later in the day. Moreover, renewed buying seen in the greenback versus its major peers following the release of a solid U.S. ISM services PMI and ADP jobs data, weakened the bid tone around the major. The European currency traded down at 1.1756, having touched a low of 1.1696 on Tuesday, its lowest since Aug. 17. FxWirePro's Hourly Euro Strength Index stood at -21.90 (Neutral) by 0400 GMT. Investors’ attention will remain on the release of ECB’s Sept policy meeting minutes, ahead of the U.S. unemployment benefits claims, trade balance, factory orders and the speeches by FOMC members Powell and Harker. Immediate resistance is located at 1.1815 (61.8% retracement of 1.2005 and 1.1696), a break above targets 1.1885 (21-DMA). On the downside, support is seen at 1.1730 (Oct. 2 Low), a break below could drag it near 1.1696 (Oct. 3 Low).
USD/JPY: The dollar steadied after tumbling in the previous session, as investors reacted positively to a solid US ISM services PMI and ADP jobs data. The major was trading flat at 112.75, having hit a high of 113.25 last week, its highest since mid-Jul. FxWirePro's Hourly Yen Strength Index stood at 46.03 (Neutral) by 0400 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. unemployment benefits claims, trade balance, factory orders and the speeches by FOMC members Powell and Harker for further momentum. Immediate resistance is located at 113.00, a break above targets 113.40. On the downside, support is seen at 112.43 (10- DMA), a break below could take it near 112.00.
GBP/USD: Sterling consolidated within narrow ranges ahead of Bank of England's Andy Haldane speech due later in the day. The BoE policymaker is expected to reiterate that a rate hike would be seen soon in the coming months. The major traded flat at 1.3245, having hit a low of 1.3222 on Tuesday, its lowest since Sept. 14. FxWirePro's Hourly Sterling Strength Index stood at -11.18 (Neutral by 0400 GMT. Investors’ focus will remain on MPC member Haldane's speech, ahead of U.S. fundamental drivers. Immediate resistance is located at 1.3317 (5-DMA), a break above could take it near 1.3396 (5-DMA). On the downside, support is seen at 1.3222 (Oct. 3 Low), a break below targets 1.3183. Against the euro, the pound was trading flat at 88.78 pence, having hit a low of 88.84 pence earlier in the day, its lowest since Sept. 19.
AUD/USD: The Australian dollar slumped, reversing most of its previous session gains, following the release of worse-than-expected Australian retail sales data. The economy's retail sales posted their biggest fall in about four-and-a-half years, slumping 0.6 percent in August. The Aussie trades 0.4 percent down 0.7832, having hit a low of 0.7785 on Tuesday, it’s lowest since Jul. 14. FxWirePro's Hourly Aussie Strength Index stood at 13.92 (Neutral) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7785 (Oct. 3 Low), a break below targets 0.7750. On the upside, resistance is located at 0.7875 (10-DMA), a break above could take it near 0.7947 (21-DMA).
NZD/USD: The New Zealand dollar edged down to a more than one-month low on the back of rising U.S. dollar and domestic election-related uncertainties. The Kiwi trades 0.1 percent down at 0.7160, having touched a low of 0.7146 earlier in the session, its lowest level since Sept. 4. FxWirePro's Hourly Kiwi Strength Index was at -33.30 (Neutral) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.7191 (5-DMA), a break above could take it near 0.7277 (Sept. 26 High). On the downside, support is seen at 0.7146 (Session Low), a break below could drag it till 0.7130.
Equities Recap
Asian shares held gains amid holiday-thinned trade, while the greenback steadied after better-than-expected economic data shed more positive light on the U.S. economy.
MSCI's broadest index of Asia-Pacific shares outside Japan traded flat.
Tokyo's Nikkei fell 0.05 percent to 20,617.10 points, Australia's S&P/ASX 200 index eased 0.01 percent to 5,651.80 points.Taiwan shares added 0.5 percent to 10,518.27 points.
China, South Korea, and Hong Kong markets remained closed for public holidays.
Commodities Recap
Crude oil prices stabilized on expectations that Saudi Arabia and Russia would extend production cuts, despite record U.S. exports weighing on the market. International benchmark Brent crude was trading 0.1 percent down at $55.82 per barrel by 0416 GMT, having hit a low of $55.36 on Wednesday, its weakest since Sept. 20. U.S. West Texas Intermediate was trading 0.1 percent up at $49.90 a barrel, after falling as low as $49.75 the day before, its lowest since Sept. 19.
Gold prices edged up, extending gains for the third straight session, while the dollar held firm on strong U.S. services sector growth, with markets awaiting the crucial U.S. non-farm payrolls report on Friday. Spot gold rose 0.05 percent to $1,274.25 an ounce at 0421 GMT, having hit its lowest since mid-August at $1,268.21 on Tuesday. U.S. gold futures for December delivery were flat at $1,276.90 per ounce.
Treasuries Recap
The 10-year U.S Treasury yield stood at 2.324 percent lower by 0.007 bps, while 5-year yield was 0.008 bps down at 1.916 percent.
The Australian government bond futures edged higher, with the three-year bond contract up 3 ticks at 97.870. The 10-year contract added 2 ticks to 97.1850.
The New Zealand government bonds rose, sending yields about 1 basis point across the curve.
The Canadian government bond prices were mixed across the yield curve. The two-year price inched down 1.5 Canadian cent to yield 1.532 percent and the 10-year gained lost 7 Canadian cents to yield 2.122 percent.
