Market Roundup
- NZ Sep Trade Balance, -1,560.0 mln, -1,470.0 mln previous.
- Obama, Clinton among targets of suspected bombs ahead of U.S. election.
- Trump, industry work behind the scenes to save Saudi arms package.
- As Trump rails against Fed, Powell takes to Capitol Hill.
- China listens to Trump cell phone calls, tries to sway policy.
- China says army will act "at any cost" to prevent Taiwan split.
- BOJ deputy gov warns against pricking bubbles with monetary tightening.
- Japan, China seek warmer ties against backdrop of U.S. trade friction.
- Japan's Kampo Insurance plans to increase foreign bond investments.
- Russia will target European countries if they host U.S. nuclear missiles – Putin.
- UK PM May receives show of loyalty after talk of leadership challenge.
- Course unchanged for ECB as growth worries bubble under.
- South Korea Q3 GDP growth misses forecasts, construction spending plunges.
Economic Data Ahead
- (0745 ET/1145 GMT) EZ Oct ECB Refinancing Rate, 0.00% forecast, 0.00% previous.
- (0745 ET/1145 GMT) EZ Oct ECB Deposit Rate, -0.40% forecast, -0.40% previous.
- N/A Germany Oct IFO Business Climate New, 103.0 forecast, 103.7 previous.
- N/A Germany Oct IFO Current Conditions New, 106.0 forecast, 106.4 previous.
- N/A Germany Oct IFO Expectations New, 100.3 forecast, 101.0 previous.
Key Events Ahead
- (0400 ET/0800 GMT) Norway Central Bank holds announcement of the Executive Board's interest rate decision in Oslo.
- (0600 ET/1000 GMT) Riksbank Governor Stefan Ingves participates in a panel as part of a seminar at Åbo Akademi University in Turku.
- (0830 ET/1230 GMT) ECB President Mario Draghi holds a press conference, after the interest rate meeting in Frankfurt.
- (1215 ET/1615 GMT) Federal Reserve Vice Chairman Richard Clarida speaks before a Peterson Institute for International Economics luncheon, in Washington.
- (1900 ET/2300 GMT) Fed Cleveland President Loretta Mester speaks before the Money Marketeers of New York University.
- N/A ECB Governing Council meeting, followed by interest rate announcement in Frankfurt.
- N/A Bank of England Deputy Governor for Prudential Regulation Sam Woods speaks at Mansion House City Banquet, London.
FX Recap
USD: An index measuring the U.S. currency versus six major peers traded around 0.16 percent lower in Asia at 96.26, after gaining an impressive 0.5 percent on Wednesday.
EUR/USD: The euro staged a small relief rally to trade at $1.1407, after giving up almost 0.7 percent on Wednesday - its steepest fall in percentage terms since Sept. 27, on concerns over the pace of economic growth in Europe. The European Central Bank (ECB) holds its monetary policy meeting later today and investors will be looking for any new guidance acknowledging the recent slowdown in growth as well as the political stand-off between Brussels and Rome over Italy's free spending budget. A consistent close below $1.1390 will drag the parity down towards key supports around $1.1185 and $1.1080 levels respectively. Alternatively, reversal from key support will drag the parity higher towards key resistances around $1.1475, $1.1550, $1.1620, $1.1738 and $1.1852 marks respectively.
USD/JPY: The Japanese yen trades marginally higher in early Asia and was currently trading around 112.05 marks. It made intraday high at 112.24 and low at 111.82 levels. A sustained close above 112.09 is required to take the parity higher towards key resistances around 112.84, 114.55 and 117.98 marks respectively. Alternatively, a daily close below 112.09 will drag the parity down towards key supports around 110.98, 110.27, 109.24, 108.72 and 107.90 marks respectively.
GBP/USD: The pound fell to a seven-week low on Wednesday before British Prime Minister Theresa May was due to meet Conservative Party lawmakers, some of whom have discussed toppling her in anger at her Brexit negotiations. May is seeking to win over lawmakers in her party who oppose her approach to the negotiations, which are stuck at an impasse just over five months before the United Kingdom leaves the European Union. The prospect of a leadership challenge and of politics scuppering an agreement with the EU has weakened the currency in recent days. The sterling fell on Wednesday to $1.2867, its lowest since Sept 5, and traded down 0.7 percent. Against a weaker euro, the pound was flat at 88.31 pence. The pair was currently trading around $1.2885 mark. A sustained close below $1.2879 requires for dragging the parity down towards key support around $1.2662 mark. On the other side, key resistances are seen at $1.2990, $1.3187, $1.3215, $1.3362 and $1.3490 levels respectively.
AUD/USD: The Australian dollar held its nerve on Thursday even as global share markets crumbled for a second day, with losses on Wall Street and a sharp drop in Treasury yields hindering their U.S. counterpart. The Aussie dollar was 0.26 percent firmer at $0.7076, having again found solid support around the $0.7041/50 area which marks recent 32-month lows. The pair made intraday high at $0.7084 and low at $0.7055 levels. Immediate support and resistance levels were seen at $0.7041 and $0.7160 mark respectively.
NZD/USD: The kiwi was likewise steady at $0.6523, after garnering support at $0.6500. Pair made intraday high at $0.6530 and low at $0.6502 levels. A sustained close above $0.6591 is required to take the parity higher towards $0.7050 mark. Alternatively reversal key resistance will take the parity down towards key supports around $0.6424 levels.
Equities Recap
Japan’s Nikkei was trading 3.20 pct lower at 21,386.50 points.
Australia’s S&P/ASX 200 was trading 2.23 pct lower at 5,698.85 points.
Shanghai composite index to open down 2.4 pct at 2,540.93 points and China's CSI300 index to open down 2.5 pct at 3,107.84 points.
Taiwanese stock was trading around 2.30 percent lower at 9,535.93 points.
Hong Kong’s Hang seng was trading 1.75 pct lower at 24,808.55 points.
India’s NSE Nifty was trading around 0.95 percent lower at 10,130.22 points while BSE Sensex was trading 0.90 points lower at 33,735.55 points.
South Korea’s Kospi was trading 1.91 percent lower at 2,057.20 points.
Commodities Recap
Oil prices fell by around one percent on Thursday, coming under pressure from sharp selloffs in global stock markets, with U.S. stocks posting the biggest daily decline since 2011 to wipe out the year's gains. Front-month Brent crude oil futures were at $75.42 a barrel at 0043 GMT, 75 cents, or 1 percent, below their last close. U.S. West Texas Intermediate (WTI) crude futures were at $66.23 a barrel, 59 cents, or 0.9 percent, below their last settlement.
Gold prices firmed early on Thursday, hovering near a more than three-month high reached earlier this week, as the U.S. dollar eased and Asian stocks slumped after Wall Street surrendered all its gains for the year. Spot gold was up 0.2 percent at $1,236.43 an ounce at 0107 GMT, not far off Tuesday's $1,239.68, the highest since July 17. U.S. gold futures were up 0.6 percent at $1,238.50 an ounce.
Treasuries Recap
U.S. 10-year treasury yields fell to 3.11 percent on Thursday as traders started to question the strong cyclical economic growth story of the U.S and rushed to the safety of sovereign bonds.
Australian government bond futures caught the general safe-haven bid and rallied for a third straight session. The three-year bond contract firmed 2.5 ticks to 97.97.940, while the 10-year contract gained 4.5 ticks to 97.3750.
Yields on New Zealand government bonds fell as much as 7 basis points at the long end of the curve.
