Market Roundup
- Japan's GDP grows for 7 straight quarters, outlook remains solid
- Australia consumer sentiment eases back in Oct-survey
- Australia Q3 Wage Price Index q/q, y/y, 0.5%, 2.0%, last 0.5%, 1.9%, f' cast 0.7%, 2.2%
- Auckland house prices see biggest annual fall since 2010
- Britain's May sees off challenges to Brexit plan, so far
- UK's Hammond has limited options to help May with budget
- China Oct FDI (YTD) 1.90% vs 1.60%
- Senior Chinese diplomat to visit North Korea as envoy of Xi
- Top central bankers vow to talk investors out of easy money
- U.S. Senate Republicans tie tax plan to repeal of key Obamacare mandate
- U.S. Commerce chief says 'some sort' of NAFTA deal will reach Trump
- Sessions changes statement about Trump campaign and Russia
Economic Data Ahead
- (0245 ET/0745 GMT) France Oct CPI (EU Norm) Final m/m, y/y, f' cast 0.1%, 1.2%, -0.2%, 1.2% last
- (0430 ET/0930 GMT) Great Britain Oct Claimant Count Unem Chng f' cast 2.3k, last 1.7k
- (0430 ET/0930 GMT) Great Britain Sept ILO Unemployment Rate f' cast 4.3%, 4.3% last
Key Events Ahead
- N/A - EU General Affairs Council meeting - Brussels
- (0200 ET/0700 GMT) Ireland cen bank's Lane will speak at a conference – Dublin
- (0300 ET/0800 GMT) Fed's Evans will speak at a UBS conference – London
- (0500 ET/1000 GMT) ECB's Praet and Denmark Nationalbank's Rohde speak at a ECB conference – Frankfurt
- (0700 ET/1200 GMT) BoE's Haldane participates at a ECB conference – Frankfurt
- (0800 ET/1300 GMT) BoE's Braodbent speaks at LSE – London
- (1005 ET/1505 GMT) Riksbank's Skingsley participates at a discussion – Stockholm
- (1610 ET/2110 GMT) Fed's Rosengren speaks at Northeastern University – Boston
FX Beat
DXY: The dollar index steadied after falling to a near 4-week low in the previous session as investors awaited U.S. consumer inflation data for October, which is expected to show a marginal increase in consumer prices. The greenback against a basket of currencies traded flat at 93.87, having touched a low of 93.75 on Tuesday, its lowest since Oct. 26. FxWirePro's Hourly Dollar Strength Index stood at 17.38 (Neutral) by 0500 GMT.
EUR/USD: The euro steadied after rising to 2-1/2 week highs in the previous session on the back of robust German and Eurozone growth figures. The European currency traded flat at 1.1794, having touched a high of 1.1805 on Tuesday; its highest since Oct. 26. FxWirePro's Hourly Euro Strength Index stood at 102.74 (Highly Bullish) by 0400 GMT. Investors’ attention will remain on the Eurozone trade balance and ECB Praet's speech, ahead of the U.S. retail sales, consumer price index, and business inventories data. Immediate resistance is located at 1.1836 (Oct. 26 High), a break above targets 1.1880. On the downside, support is seen at 1.1750, a break below could drag it lower 1.1720.
USD/JPY: The dollar declined to a 2-week low in early trade, tracking the decline in the U.S. 10-year treasury yield and the flattening of the yield curve, in the wake of rising uncertainty over the US tax reforms. The major was trading 0.2 percent down at 113.19, having hit a low of 113.03 earlier, its lowest since Oct. 31. FxWirePro's Hourly Yen Strength Index stood at 37.68 (Neutral) by 0400 GMT. Investors’ will continue to track broad-based market sentiment, ahead of the U.S. retail sales, consumer price index, and business inventories data for further momentum. Immediate resistance is located at 113.78 (10-DMA), a break above targets 114.40. On the downside, support is seen at 113.00, a break below could take it near 112.80.
GBP/USD: Sterling eased, reversing some of its previous session gains, as lower-than-expected UK inflation data weakened the case for the Bank of England to raise interest rates again in the near term. The major traded 0.2 percent down at 1.3142, having hit a low of 1.3061 on Monday, its lowest since Nov. 6. FxWirePro's Hourly Sterling Strength Index stood at 16.42 (Neutral) by 0400 GMT. Investors’ focus will remain on political developments and the UK labor market data, ahead of the U.S. fundamental drivers. Immediate resistance is located at 1.3200, a break above could take it near 1.3227. On the downside, support is seen at 1.3085 (Nov. 9 Low), a break below targets 1.3040. Against the euro, the pound was trading 0.1 percent down at 89.71 pence, having hit a low of 89.80 pence the day before, its lowest since Oct. 20.
AUD/USD: The Australian dollar slumped to 4-month lows as weaker reading on wages threatened to keep inflation, and thus interest rates lower for even longer than expected. The economy's wage price index for Q3 came in at 0.5 percent quarter-on-quarter versus 0.7 percent estimated, while the annualized figure came in at 2.0 percent against 2.2 percent forecast. The Aussie trades 0.6 percent down at 0.7585, having hit a low of 0.7576 earlier; it’s lowest since Jul. 05. FxWirePro's Hourly Aussie Strength Index stood at -152.13 (Highly Bearish) by 0500 GMT. Investors will continue to track overall market sentiment, ahead of U.S. economic releases. Immediate support is seen at 0.7576 (Session Low), a break below targets 0.7552. On the upside, resistance is located at 0.7642 (78.6% retracement of 0.7883 and 0.7576), a break above could take it near 0.7694 (61.8% retracement).
NZD/USD: The New Zealand dollar eased, extending losses for the fifth straight session, as crude oil prices came under a renewed selling pressure after the API's weekly crude oil stock report revealed a large buildup in the U.S. oil inventories. The Kiwi trades 0.06 percent down at 0.6872, having touched a low of 0.6844 the prior day, its lowest level since Nov. 1. FxWirePro's Hourly Kiwi Strength Index was at -85.71 (Slightly Bearish) by 0500 GMT. Investors’ will continue to track broad-based market sentiment, ahead of U.S. economic data. Immediate resistance is located at 0.6895 (61.8% retracement of 0.6979 and 0.6844), a break above could take it near 0.6927 (38.2% retracement of 0.6979 and 0.6844). On the downside, support is seen at 0.6830, a break below could drag it till 0.6800.
Equities Recap
Asian shares slumped, as weaker crude oil prices hit Wall Street, while the euro held gains near 2-1/2 week high following robust German and Eurozone economic growth figures.
MSCI's broadest index of Asia-Pacific shares outside Japan tumbled 0.4 percent.
Tokyo's Nikkei eased 1.1 percent to 22,138.37 points, Australia's S&P/ASX 200 index slumped 0.6 percent to 5,934.20 points and South Korea's KOSPI declined 0.4 percent to 2,516.09 points.
Shanghai composite index fell 0.7 percent to 3,405.47 points, while CSI300 index was trading 0.7 percent down at 4,070.83 points.
Hong Kong’s Hang Seng was trading 0.8 percent lower at 28,918.84 points. Taiwan shares shed 0.5 percent to 10,630.65 points.
Commodities Recap
Crude oil prices steadied after falling over 1 percent to a more than 1-week low in the previous session after the International Energy Agency cast doubts over the past few months' tightening fuel markets. International benchmark Brent crude was trading 0.05 percent up at $61.40 per barrel by 0442 GMT, having hit a low of $61.19 the day before, its lowest since Nov. 3. U.S. West Texas Intermediate was trading 0.2 percent up at $55.09 a barrel, after falling as low as $54.80 on Tuesday, its lowest since Nov. 3.
Gold prices rose, having rebounded from a more than one-week low touched in the previous session, as the investors waited for cues from U.S. consumer inflation data. Spot gold was 0.2 percent lower at $1,280.98 per ounce at 0445 GMT, having touched a low of $1,269.94 the day before, its lowest since Nov. 6. U.S. gold futures for December delivery slipped 0.2 percent to $1,280.90.
Treasuries Recap
The 10-year U.S Treasury yield stood at 2.3611 percent lower by 0.02 bps, while 5-year yield was 0.015 bps up at 2.049 percent.
The Japanese government bonds rose slightly after gross domestic product (GDP) growth slows in the third-quarter, coupled with heavy bonds buying from the Bank of Japan in its daily market operations. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, fell 1 basis point to 0.045 percent, the yield on long-term 40-year declined nearly 1 basis point to 0.987 percent and the yield on short-term 2-year declined 1 basis point to -0.184 percent.
The Australian government bonds gained after Australian wage growth has come in well below expectations for the second straight month. The yield on the benchmark 10-year Treasury note, which moves inversely to its price, fell 6 basis points to 2.604 percent, the yield on the long-term 30-year note also slid 6 basis points to 3.370 percent and the yield on short-term 2-year declined 5-1/2 basis points to 1.795 percent.
The New Zealand government bonds closed higher following a rise in prices of Australian debt, which pushed the yields over 5 basis points across the curve. At the time of closing, the yield on the benchmark 10-year Treasury note, which moves inversely to its price, fell 6-1/2 basis points to 2.905 percent, the yield on 20-year note also slid 5 basis points to 3.480 percent and the yield on short-term 2-year ended 4 basis points lower at 2.03 percent.
The Canadian government bond prices were flat to higher across the yield curve, with the two-year unchanged to yield 1.463 percent and the 10-year up 17 Canadian cents to yield 1.949 percent.
