Market Roundup
- Cohen testifies Trump told him to commit crime by paying off women
- Former Trump campaign chairman Manafort found guilty of tax and bank fraud
- Japan c. bank may dial back stimulus before price goal met - ex-BOJ Ishida
- Australia's energy policy a 'significant uncertainty' for inflation - RBA
- Australian PM faces new leadership challenge from conservative rival
- Australian PM Turnbull dumps company tax cut policy
- U.S. and Mexico put off NAFTA talks until Wednesday, autos eyed
- New Zealand Q2 Retail Sales Volumes QQ, 1.10%, 0.10% previous
Economic Data Ahead
- No major economic data releases
Key Events Ahead
- (1400 ET/1800 GMT) FOMC will release the minutes from its July 31-Aug. 1 policy meeting
FX Beat
DXY: The dollar index bounced back after falling to a near 2-week low in the prior session, ahead of the release of the Federal Reserve's August meeting minutes later today and its annual economic symposium at Jackson Hole, Wyoming on Friday. The greenback against a basket of currencies trades 0.1 percent up at 95.30, having touched a low of 95.08 the day before, its lowest since August 9. FxWirePro's Hourly Dollar Strength Index stood at -113.42 (Highly Bearish) by 0500 GMT.
EUR/USD: The euro steadied after rising to a near 2-week peak in the previous session, as U.S. President Donald Trump's comments on monetary policy continued to weigh on the greenback. The European currency traded 0.05 percent up at 1.1574, having touched a high of 1.1601 on Tuesday, its highest since August 9. FxWirePro's Hourly Euro Strength Index stood at 89.46 (Highly Bullish) by 0500 GMT. Investors’ attention will remain on U.S. existing home sales data, amid a lack of economic data from the EZ docket. Immediate resistance is located at 1.1628 (August 8 High), a break above targets 1.1667 (August 2 High). On the downside, support is seen at 1.1451 (10-DMA), a break below could drag it till 1.1394 (August 20 Low).
USD/JPY: The dollar rose, extending previous session gains, as the United States and China agreed to hold low-level trade talks later in the day, while investors awaited the minutes from the Federal Reserve's August meeting for further clues on the monetary policy. The major was trading 0.1 percent up at 110.43, having hit a low of 109.77 on Tuesday, its lowest since June 27. FxWirePro's Hourly Yen Strength Index stood at -63.08 (Bearish) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of the U.S. existing home sales data. Immediate resistance is located at 110.80 (61.8% retracement of 111.43 and 109.77), a break above targets 111.08 (78.6% retracement). On the downside, support is seen at 110.02 (Session Low), a break below could take it lower 109.68 (June 27 Low).
GBP/USD: Sterling rose, hovering closer to a near 2-week peak, after Britain's chief Brexit negotiator, Dominic Raab, stated that the UK is still confident to reach a deal with the European Union in October. The major traded 0.1 percent up at 1.2914, having hit a high of 1.2924 on Tuesday; it’s highest since August 8. FxWirePro's Hourly Sterling Strength Index stood at 76.42 (Slightly Bullish) 0500 GMT. Investors attention will remain on the U.S. fundamental drivers, as UK economic calendar remains absolutely data empty. Immediate resistance is located at 1.2977 (61.8% retracement of 1.3173 and 1.2661), a break above could take it near 1.3173 (July 26 High). On the downside, support is seen at 1.2780 (5-DMA), a break below targets 1.2730. Against the euro, the pound was trading flat at 89.65 pence, having hit a low of 90.02 on Tuesday, it’s lowest since August 9.
AUD/USD: The Australian dollar eased, halting a 4-day winning streak after Australian Prime Minister Malcolm Turnbull discarded his government's proposal to cut company tax after the policy was rejected by the parliament. The Aussie trades 0.2 percent down at 0.7355, having hit a high of 0.7318 on Tuesday; it’s highest since August 9. FxWirePro's Hourly Aussie Strength Index stood at 37.75 (Neutral) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7313 (10-DMA), a break below targets 0.7295 (August 20 Low). On the upside, resistance is located at 0.7411 (August 3 High), a break above could take it near 0.7453 (August 9 High).
NZD/USD: The New Zealand dollar advanced to a near 2-week peak after data showed domestic Q2 retail sales rose 1.1 percent q/q versus expected 0.4 percent q/q and prior revised 0.3 percent. The Kiwi trades 0.2 percent up at 0.6703, having touched a high of 0.6720, its highest level since 9 August. FxWirePro's Hourly Kiwi Strength Index was at 131.95 (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 0.6740, a break above could take it near 0.6790. On the downside, support is seen at 0.6621 (5-DMA), a break below could drag it below 0.6579 (August 17 Low).
Equities Recap
Asian shares gained on hopes that the trade talks between the U.S. and China expected this week will ease trade tensions.
MSCI's broadest index of Asia-Pacific shares outside Japan advanced 0.3 percent.
Tokyo's Nikkei surged 0.6 percent to 22,362.55 points, Australia's S&P/ASX 200 index eased 0.3 percent to 6,266.00 points, and South Korea's KOSPI rose 0.2 percent to 2,274.05 points.
Shanghai composite index fell 0.7 percent to 2,713.25 points, while CSI300 index traded 0.6 percent down at 3,304.82 points.
Hong Kong’s Hang Seng traded 0.1 percent higher at 27,791.95 points. Taiwan shares added 0.1 percent to 10,804.20 points.
Commodities Recap
Crude oil prices surged, supported by a decline in U.S. crude inventories and concerns about a potential shortfall of Iranian oil from November due to U.S. sanctions. International benchmark Brent crude was trading 0.2 percent up at $72.89 per barrel by 0502 GMT, having hit a high of $72.90 earlier, its highest since August 14. U.S. West Texas Intermediate was trading 0.1 percent higher at $66.15 a barrel, after falling as low as $64.45 on Thursday, its lowest since June 21.
Gold prices rallied to a 1-week high near the key $1,200 level as the dollar remained weak on U.S. President Donald Trump's criticism of the Federal Reserve policy stance. Spot gold was trading up at $1,195.40 an ounce at 0507 GMT, having hit a high of $1197.70 earlier, its highest since August 14. U.S. gold futures rose 0.2 percent to $1,202 an ounce.
Treasuries Recap
The Japanese government bonds slid during late Asian session as risk appetite improved despite the United States President Donald Trump’s suspected involvement in campaign finance crimes, as outlined by his lawyer, Michael Cohen. The yield on the benchmark 10-year JGB note, which moves inversely to its price, remained slightly higher at 0.095 percent, the yield on the long-term 30-year note jumped 1-1/2 basis points to 0.846 percent and the yield on short-term 2-year traded tad higher at -0.119 percent.
The Australian bonds traded narrowly mixed in subdued session as investors remain sidelined in any major deal ahead of the U.S.-China trade talks. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, traded flat at 2.546 percent, the yield on the long-term 30-year bond remained steady at 3.051 percent and the yield on short-term 2-year fell 1 basis point lower at 2.011 percent.
The Canadian government bond prices were lower across a steeper yield curve in sympathy with U.S. Treasuries. The 10-year fell 9 Canadian cents to yield 2.262 percent.
