Market Roundup
- Gold flat as investors shift focus to Trump speech
- Australian business activity improves modestly in Oct
- Oil dips as Saudi Arabian crude output increase
Economic Data Ahead
- (0430 ET/0930 GMT) UK ILO unemployment rate
- (0430 ET/0930 GMT) UK claimant count rate
- (0430 ET/0930 GMT) UK claimant count change
- (0500 ET/1000 GMT) EZ ZEW Survey - Economic Sentiment
- (0500 ET/1000 GMT) German ZEW Survey - Current Situation
- (0500 ET/1000 GMT) German ZEW Survey - Economic Sentiment
Key Events Ahead
- (0300 ET/0800 GMT) European Central Bank Executive Board member Benoît Cœuré gives a speech
- (0330 ET/0830 GMT) European Central Bank Executive Board member Yves Mersch's speech
FX Beat
DXY: The dollar index held steady as investors remained cautious ahead of a speech by President Trump to the Economic Club of New York later in the day in case there was fresh news on the U.S.-China phase 1 trade deal. The greenback against a basket of currencies traded flat at 98.23, having touched a high of 98.40 on Friday, its highest since October 16.
EUR/USD: The euro steadied after falling to a near 4-week low in the previous session on European Central Bank policymaker Yves Mersch comments, stating that persistent weakness in eurozone manufacturing raised the risk of other sectors of the economy being infected. The European currency traded flat at 1.1033, having touched a low of 1.1016 on Monday, its lowest since October 15. Investors’ attention will remain on a series of data from the Eurozone economies, EZ ZEW Survey and ECB policymaker speeches, ahead of the Fed officials' speeches. Immediate resistance is located at 1.1048 (5-DMA), a break above targets 1.1062. On the downside, support is seen at 1.1012, a break below could drag it below 1.0985.
USD/JPY: The dollar index held firm above the 109.00 handle amid optimism that Washington and Beijing would soon reach a deal to end their debilitating trade war. However, concerns over rising Hong Kong tensions limited the upside in the pair. The major was trading 0.1 percent up at 108.97, having hit a high of 109.48 on Thursday, its highest since May 31. Investors’ will continue to track the broad-based market sentiment, ahead of the Fed officials' speeches. Immediate resistance is located at 109.62 (May 31 High), a break above targets 109.92 (May 30 High). On the downside, support is seen at 108.81 (10-DMA), a break below could take it near at 108.49.
GBP/USD: Sterling consolidated near a 1-week peak hit in the previous session, as the risk of a hung parliament in UK elections eased slightly. On Monday, Brexit Party leader Nigel Farage said his party was standing down candidates in seats won by the Conservatives in 2017 and would instead focus on challenging anti-Brexit politicians. The major traded 0.05 percent up at 1.2860, having hit a high of 1.2897 on Monday, it’s highest since November 5. Investors’ attention will remain on the development surrounding Brexit, ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.2917, a break above could take it near 1.2972 (November 1 High). On the downside, support is seen at 1.2834 (5-DMA), a break below targets 1.2768. Against the euro, the pound was trading flat at 85.79 pence, having hit a high of 85.57 on Monday, it’s highest since May 8.
AUD/USD: The Australian dollar rebounded from a 2-week low after National Australia Bank's index of business conditions inched up one point to +3 in October as firms reported a rise in sales, offering a hint of stabilisation after months of weakness. The Aussie trades 0.05 percent down at 0.6846, having hit a low of 0.6832 earlier, it’s lowest since October 28. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.6810, a break below targets 0.6784. On the upside, resistance is located at 0.6876, a break above could take it near 0.6907.
NZD/USD: The New Zealand dollar eased, reversing most of its previous session gains as uncertainty remained over whether the United States and China could end their trade war. The Kiwi trades 0.4 percent down at 0.6332, having touched a low of 0.6322 on Friday, its lowest level since October 17. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6396, a break above could take it near 0.6431. On the downside, support is seen at 0.6313, a break below could drag it below 0.6289.
Equities Recap
Asian shares slumped amid persisting uncertainty over whether the United States and China could end their damaging trade war.
MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.5 percent.
Tokyo's Nikkei rallied 0.5 percent to 23,452.26 points, Australia's S&P/ASX 200 index eased 0.3 percent to 6,753.00 points and South Korea's KOSPI surged 0.3 percent to 2,132.64 points.
Shanghai composite index rose 0.1 percent to 2,912.63 points, while CSI 300 index traded 0.05 percent down at 3,902.76 points.
Hong Kong’s Hang Seng traded 0.3 percent higher at 27,000.56 points. Taiwan shares added 0.8 percent to 11,520.37 points.
Commodities Recap
Crude oil prices eased, extending losses for the second straight session, as Saudi Arabian crude output rose, reinforcing concerns about a glut. International benchmark Brent crude was trading 0.1 percent down at $62.15 per barrel by 0446 GMT, having hit a low of $60.65 on Friday, its lowest since November 1. U.S. West Texas Intermediate was trading 0.05 percent down at $56.80 a barrel, after falling as low as $55.74 on Friday, its lowest since November 1.
Gold prices consolidated near 3-month low hit in the previous session, as investors waited for clues from U.S. President Donald Trump on the status of trade talks with China. Spot gold was trading flat at $1,456.17 per ounce by 0448 GMT, having touched a low of $1,455.74 on Monday, its lowest August 5. U.S. gold futures were also unchanged at $1,456.60 per ounce.
Treasuries Recap
The Australian government bonds jumped during Asian session of the second trading day of the week amid a muted day that witnessed data of little economic significance ahead of the country’s employment report for the month of October, scheduled to be released on November 14 by 00:30GMT. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, slumped 2 basis points to 1.276 percent, the yield on the long-term 30-year bond plunged 2-1/2 basis points to 1.877 percent and the yield on short-term 2-year suffered 2 basis points at 0.859 percent.
