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Asia Roundup: Japanese yen remains almost unchanged despite robust retail sales data, Asian markets mixed, gold stabilizes below $1,490 mark - Wednesday, October 30, 2019

Market Roundup

  • UK parliament approves early general election on December 12.
     
  • Australia’s new home sales m/m stands at 5.7 vs 7.3 previous released.
     
  • Australia’s CPI stands at 0.5 vs 0.6 previous released (expected 0.5).
     
  • Australia’s Trimmed mean CPI stands at 0.4 vs 0.4 previous released (expected 0.4).
     
  • Japan retail sales stands at 9.1 pct vs 1.8 pct previous release (expected 6.0).

Economic Data Ahead

  • (0300 ET/0700 GMT) UK nationwide HPI m/m, y/y.
     
  • (0345 ET/0745 GMT) France consumer spending.
     
  • (0400 ET/0800 GMT) Swiss KOF leading indicator.
     
  • (0400 ET/0800 GMT) Spain CPI, HICP.
     
  • (0455 ET/0855 GMT) German unemployment change, unemployment rate.
     
  • (0500 ET/0900 GMT) Italy business confidence, consumer confidence.
     
  • (0500 ET/0900 GMT) Swiss ZEW expectations.
     
  • (0600 ET/1000 GMT) Euro zone business and consumer survey, industrial sentiment.

Key Events Ahead

  • (1000 ET/1400 GMT) BOC rate statement.
     
  • (1400 ET/1800 GMT) FOMC rate statement.

FX Recap

USD: The U.S. dollar index that tracks the greenback against a basket of other currencies inched down 0.01% to 97.68.

EUR/USD: The euro remains almost unchanged against U.S. dollar and hovers around 1.11 mark. It made intraday high at $1.1114 and low at $1.1106 mark. A consistent close below $1.1079 will drag the parity down towards key supports around $1.1026 and $1.0852 levels respectively. Alternatively, reversal from key support will drag the parity higher towards key resistances around $1.1158, $1.1220, $1.1390, $1.1472, $1.1550, $1.1620 and $1.1820 marks respectively.

USD/JPY: The Japanese yen trades almost flat against U.S. dollar despite robust retail sales data. The pair is currently trading around 108.83 mark. It made intraday high at 108.89 and low at 108.81 levels. A sustained close above 108.93 is required to take the parity higher towards key resistances around 109.62, 112.60 and 113.98 marks respectively. Alternatively, a daily close below 108.38 will drag the parity down towards key support around 106.90 and 104.20 marks respectively.

GBP/USD: The pound trades flat against U.S. dollar and stabilizes above $1.2850 mark. The pair slipped after U.K. Prime Minister Boris Johnson failed to win support for an early general election. Now, UK parliament approves early general election on December 12. A sustained close below $1.2821 requires for dragging the parity down towards key support around $1.2644 and $1.2352 mark respectively. On the other side, key resistances are seen at $1.2911, 1.30, 1.3158 and 1.3226 levels respectively.

AUD/USD: The Aussie trades marginally lower against major peers immediately after CPI, mean CPI data. The pair made intraday high at $0.6871 and low at $0.6848 levels. A consistent close below $0.6820 requires for downside rally. On the other side, a sustained close above $0.6867 will take the parity higher towards $0.6977 and $0.7076 levels respectively.

NZD/USD: The New Zealand dollar moves in stiff boundaries from $0.6330 to $0.6375 levels. Pair made intraday high at $0.6368 and low at $0.6344. A sustained close above $0.6422 requires for the upside rally. Alternatively, current downside rally will take the parity down towards key supports around $0.6236 and $0.6196 levels respectively.

Equities Recap

Japan’s Nikkei was trading 0.58 pct lower at 22,858.50 points.

Australia’s S&P/ASX200 was trading 0.94 pct lower at 6,682.55 points.

Hong Kong's hang seng index was trading 0.30 percent lower at 26,705.48 points.

Taiwan stock was trading 0.13 percent higher at 11,348.54.55 points.

South Korea’s kospi was trading 0.70 percent lower at 2,078.59 points.

India’s NSE Nifty was trading 0.50 pct higher at 11,847.80 points while BSE sensex was trading 0.54 points higher at 40,052.71 points.

Commodities Recap

Oil prices dropped on Wednesday ahead of Crude oil inventories report. Brent crude oil was down 14 cents at $61.44 a barrel. U.S. On the other side, West Texas Intermediate (WTI) crude was down 18 cents $55.48 a barrel, having dropped 0.5% in the previous session.

Gold was stabilizes below $1,490 mark on Wednesday and was currently trading around $1,488 mark. Gold faces strong resistance at $1,505 mark and sustained close above targets key resistances around $1,532 and $$1,552 mark respectively. Alternatively, a consistent close below $1,487 mark will drag the parity down towards $1,472 and $1,440 mark respectively.

Treasuries Recap

The Australian government bonds jumped during Asian session Wednesday after the country’s consumer price inflation (CPI) for the third quarter of this year rose lower than prior reading in Q2, however, meeting market expectations. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, plunged nearly 4 basis points to 1.140 percent, the yield on the long-term 30-year bond also plummeted 4 basis points to 1.716 percent and the yield on short-term 2-year traded nearly 1-1/2 basis points down at 0.821 percent.

The Japanese government bonds surged at close Wednesday as investors await the country’s industrial production data for the month of September, scheduled to be released today by 23:50 GMT and the Bank of Japan’s (BoJ) monetary policy meeting, due to be held on October 31 for further direction to the debt market. At close, the yield on the benchmark 10-year JGB note, which moves inversely to its price, suffered 6 basis points to -0.117 percent, the yield on the long-term 30-year slumped 2 basis points to 0.404 percent and the yield on short-term 2-year suffered 9 basis points to -0.216 percent.

By Aarti Panchal
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