Market Roundup
- Trump says to push Japan for freer trade; calls ties better than ever
- Japan Oct services PMI, 53.4, 26-month high, last 51.0, sharp rise in new orders
- Japan Oct composite PMI, 53.4, 5-month high, last 51.7
- BOJ's Kuroda says has confidence in strengthening economy, price outlook
- Oil hits highest levels since 2015 amid tightening markets, Saudi purge
- Future Saudi king tightens grip on power with arrests including Prince Alwaleed
- Australian PM to force lawmakers to declare citizenship to end political crisis
- Australian Oct ANZ Internet & NewsPaper Job, 1.4% vs 0.0%, revised -0.7%
- New Zealand’s c. bank to stand pat as gov't policy changes loom
- New Zealand inflation expectations for year ahead rise in Q4 - RBNZ survey
- Ex-Catalan leader Puigdemont freed with conditions in Belgium
- Britain's May to tell business a Brexit transition period "crucial" to success
- BoE’s Carney sees slower growth without Brexit deal
- Germany's Greens overtake liberals in poll as coalition talks continue - Rtrs poll
- PBOC gov urges China to promote equity, cut debt
- Riding high, Xi looks to soothe Trump as U.S. pressures China
- U.S. House weighing 'host of ideas' in tax bill revision, Ryan says
- Dudley to retire early as Fed overhaul gains steam
- Gunman kills at least 26 worshipers at small-town Texas church
- Speculators pare bearish bets on dollar to 15-week low –CFTC
Economic Data Ahead
- (0200 ET/0700 GMT) Germany Sept Industrial Orders m/m, forecast -1.5%, 3.6% last
- (0350 ET/0850 GMT) France Oct Markit Serv PMI, forecast 57.4, 57.4 last
- (0350 ET/0850 GMT) France Oct Markit Comp PMI, forecast 57.5, 57.5 last
- (0355 ET/0855 GMT) Germany Oct Markit Services PMI, forecast 55.2, 55.2 last
- (0355 ET/0855 GMT) Germany Oct Markit Comp Final PMI, forecast 56.9, 56.9 last
- (0400 ET/0900 GMT) EZ Oct Markit Serv Final PMI, forecast 54.9, 54.9 last
- (0400 ET/0900 GMT) EZ Oct Markit Comp Final PMI, forecast 55.9, 55.9 last
- (0430 ET/0930 GMT) EZ Nov Sentix Index, forecast 30.8, 29.7 last
- (0500 ET/1000 GMT) EZ Sept EZ Producer Price m/m, y/y, forecast 0.4%, 2.8%, 0.3%, 2.5%, last
Key Events Ahead
- N/A ECB's Draghi and Coeure participate in a Eurogroup Meeting - Brussels
- N/A Bank of Spain's Maria Linde & Bank of Italy's Visco speak at conference - Madrid
- (0300 ET/0800 GMT) ECB's Praet addresses at a ECB workshop - Frankfurt
- (0530 ET/1030 GMT) NY Fed's Potter speaks at a ECB workshop - Frankfurt
- (1210 ET/1710 GMT) Fed's Dudley speak at Economic Club - New York
- (1300 ET/1800 GMT) ECB's Mersch and Jazbec speak at Banking Association of Slovenia – Brdo
FX Beat
DXY: The dollar index rose to a 1-week high after a string of U.S. data bolstered views the Federal Reserve will hike interest rates next month and tighten further in 2018. The greenback against a basket of currencies traded flat at 94.95, having touched a high of 95.08 earlier, its highest since Oct. 27. FxWirePro's Hourly Dollar Strength Index stood at 101.05 (Highly Bullish) by 0500 GMT.
EUR/USD: The euro fell to a 1-week low as the greenback rose after the latest batch of U.S. data backed expectations for the Federal Reserve to raise interest rates next month and tighten further in 2018. The European currency traded flat at 1.1613, having touched a low of 1.1596 earlier, its lowest since Oct. 30. FxWirePro's Hourly Euro Strength Index stood at -27.82 (Neutral) by 0400 GMT. Investors’ attention will remain on Eurozone service PMI and Sentix investor confidence, ahead of the FOMC member Yellen and Fed's William Dudley speech. Immediate resistance is located at 1.1636 (78.6% retracement of 1.1837 and 1.1674), a break above targets 1.1676 (10-DMA). On the downside, support is seen at 1.1593 (Oct. 30 Low), a break below could drag it lower 1.1574 (Oct. 27 Low).
USD/JPY: The dollar rallied to a near 8-month high as robust U.S. services sector activity strengthened market expectations for the Fed to raise interest rates in December for the third time this year. The major was trading 0.2 percent up at 114.24, having hit a high of 114.73, its highest since Mar. 15. FxWirePro's Hourly Yen Strength Index stood at -112.54 (Highly Bearish) by 0400 GMT. Investors’ will continue to track broad-based market sentiment, ahead of the FOMC member Yellen and Fed's William Dudley speech for further momentum. Immediate resistance is located at 114.70, a break above targets 115.00. On the downside, support is seen at 113.77 (10-DMA), a break below could take it near 113.11 (21-DMA).
GBP/USD: Sterling steadied after data on Friday showed Britain's dominant services sector grew at the fastest rate in six months. The major traded flat at 1.3072, having hit a low of 1.3039 the prior session, its lowest since Oct. 6. FxWirePro's Hourly Sterling Strength Index stood at -71.35 (Bearish) 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 1.3100, a break above could take it near 1.3137. On the downside, support is seen at 1.3039 (Previous Session Low), a break below targets 1.2968. Against the euro, the pound was trading 0.1 percent down at 88.80 pence, having hit a low of 89.38 pence on Thursday, its lowest since Oct. 26.
AUD/USD: The Australian dollar edged up, reversing some of its previous session gains, as investors speculated the country's central bank would reiterate its neutral stance at a policy meeting this week following series of soft domestic data. The Aussie trades 0.1 percent up at 0.7652 having hit a high of 0.7729 on Thursday; it’s highest since Oct. 25. FxWirePro's Hourly Aussie Strength Index stood at -89.59 (Slightly Bearish) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7624 (Oct. 27 Low), a break below targets 0.7600. On the upside, resistance is located at 0.7676 (5-DMA), a break above could take it near 0.7700.
NZD/USD: The New Zealand dollar fell, extending previous session losses, ahead of the Reserve Bank of New Zealand's rates decision and monetary policy statement due on Thursday. The Kiwi trades 0.2 percent down at 0.6890, having touched a high of 0.6950 in the previous session, its highest level since Oct. 24. FxWirePro's Hourly Kiwi Strength Index was at 34.53 (Neutral) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6968 (61.8% retracement of 0.7206 and 0.6818), a break above could take it near 0.7013 (50.0% retracement of 0.7206 and 0.6818). On the downside, support is seen at 0.6860, a break below could drag it till 0.6820.
Equities Recap
Asian shares slumped from decade highs, while the greenback advanced to a 1-week peak after series of U.S. data bolstered views the Federal Reserve will hike interest rates next month.
MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.7 percent.
Tokyo's Nikkei gained 0.05 percent to 22,549.02 points, Australia's S&P/ASX 200 index fell 0.1 percent to 5,953.80 points and South Korea's KOSPI declined 0.4 percent to 2,547.44 points.
Shanghai composite index rose 0.3 percent to 3,381.02 points, while CSI300 index was trading 0.5 percent up at 4,012.61 points.
Hong Kong’s Hang Seng was trading 0.2 percent lower at 28,542.92 points. Taiwan shares shed 0.2 percent to 10,786.19 points.
Commodities Recap
Crude oil prices rose to their highest levels since July 2015 as markets tightened, while Saudi Arabia's crown prince confirmed his power over the weekend through an anti-corruption crackdown that included high profile arrests. International benchmark Brent crude was trading 0.2 percent up at $62.24 per barrel by 0423 GMT, having hit a high of $62.36, its highest since July 2015. U.S. West Texas Intermediate was trading 0.2 percent up at $55.74 a barrel, after rising as high as $55.96, its highest since Jul. 2015.
Gold prices slightly edged higher as the dollar firmed near a 1-week after upbeat U.S. economic data strengthened the prospect of further interest rate hikes by the Federal Reserve. Spot gold was flat at $1,269.67 per ounce at 0438 GMT, having touched a one-week low of $1,265.43 on Friday. U.S. gold futures for December delivery dipped 0.1 percent to $1,267.70.
Treasuries Recap
The 10-year U.S Treasury yield stood at 2.337 percent lower by 0.005 bps, while 5-year yield was 0.008 bps down at 1.996 percent.
The Japanese government bonds gained as Bank of Japan Governor Haruhiko Kuroda spoke on its recommitment to the ultra-loose monetary policy until 2 percent inflation is achieved. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, fell 2-1/2 basis points to 0.033 percent, the yield on long-term 30-year also slipped 2-1/2 basis point to 0.821 percent and the yield on short-term 2-year decline 2 basis points to -0.176 percent.
The Australian bonds traded narrowly mixed as investors awaited the Reserve of Australia monetary policy meeting scheduled to be held on Tuesday at 03:30 GMT. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, traded flat at 2.587 percent, the yield on the long-term 30-year note rose 1/2 basis point to 3.346 percent and the yield on short-term 2-year dipped nearly 1 basis point to 1.770 percent.
The New Zealand bonds sharply jumped at the time of closing as investors poured into safe-haven assets ahead of the GlobalDairyTrade (GDT) price auction, scheduled to be held on November 7. At the time of closing, the yield on the benchmark 10-year Treasury note, which moves inversely to its price, slumped 9-1/2 basis points to 2.78percent, the yield on the 20-year note plunged 11-1/2 basis points to 3.29 percent and the yield on short-term 2-year traded 2-1/2 basis points lower at 1.96 percent.
