Market Roundup
- EUR/USD 0.17%, USD/JPY -0.17%, GBP/USD 0.32%, EUR/GBP -0.16%
- DXY 0.1%, DAX -0.34%, FTSE -1.07%, Brent -0.2%, Gold 0.2%
- U.S. 10-year bond yield hits multi-year high at 3.2320%
- Eurozone bond yields surge after heaviest U.S. Treasury selloff in 2 years
- 'Fully confident' White House receives FBI report on Kavanaugh
- UK's May planning to rush Brexit through parliament - Bloomberg
- Traders bet on oil at $100 as Iran sanctions loom
- Need for lengthy ECB guidance will diminish as inflation rises: Rehn
- Risks facing Japan have increased amid trade tensions - IMF
- Investments are weak spot for German economy-banking association
- Oil holds near four-year highs as Saudi, Russia agree supply rise
Economic Data Ahead
- (0830 ET/1230 GMT) The number of Americans filing for unemployment benefits is likely to have decreased by 1,000 to a seasonally adjusted 213,000 for the week ended Sept. 28, while continuing claims for the week ended Sept. 21 is expected to decline to 1.665 million from a previous reading of 1.661 million.
- (1000 ET/1400 GMT) The United States is likely to report that factory orders increased 2.1 percent in August, after posting a fall of 0.8 percent in the prior month.
- (1000 ET/1400 GMT) The Richard Ivey School of Business releases Canada's seasonally adjusted Ivey Purchasing Managers Index for the month of September. The index posted a reading of 61.9 in the prior month.
- (1030 ET/1430 GMT) The Energy Information Administration (EIA) reports its Natural Gas Storage for the week ending September 28.
- (1500 ET/1800 GMT) Mexico's central bank meets to decide its interest rate and is expected to leave benchmark rate stable at 7.75 percent
Key Events Ahead
- (0915 ET/1315 GMT) Federal Reserve Vice Chair for Supervision Randal Quarles speaks on "Trends in Urban and Rural Community Banks" before the Community Banking in the 21st Century conference hosted by the Federal Reserve Bank of St. Louis.
- (1030 ET/1430 GMT) Bank of Canada Governor Stephen Poloz: Brief remarks on launch of online resource, money and monetary policy in Canada – Ottawa.
- (1200 ET/1600 GMT) European Central Bank’s Benoit Coeure speaks at the local French business community in Chateaudun
FX Beat
DXY: The dollar index edged down after rising to a 6-week peak on the back of upbeat U.S. economic data and hawkish comments from Federal Reserve policymakers that raised prospects of the central bank sticking to its tighter monetary policy. The greenback against a basket of currencies trades 0.1 percent down at 95.88, having touched a high of 96.12 earlier, its highest since August 20. FxWirePro's Hourly Dollar Strength Index stood at 62.75 (Bullish) by 1000 GMT.
EUR/USD: The euro bounced back from an over 1-1/2 month low touched earlier in the session, after a Reuters poll of currency strategists indicated that the euro will withstand the latest political turmoil in Italy and any short-term drop will be limited. The European currency traded 0.2 percent up at 1.1496, having touched a low of 1.1463 earlier, its lowest since August 20. FxWirePro's Hourly Euro Strength Index stood at -20.70 (Neutral) by 1000 GMT. Immediate resistance is located at 1.1536 (August 10 High), a break above targets 1.1601 (August 21 High). On the downside, support is seen at 1.1450, a break below could drag it till 1.1415.
USD/JPY: The dollar declined after rising to an 11-month peak earlier in the day on the back of upbeat U.S. data and perceived hawkish comments from Federal Reserve Chairman Jerome Powell. The major was trading 0.2 percent down at 114.31, having hit a high of 114.54, its highest since Nov. 6. FxWirePro's Hourly Yen Strength Index stood at -26.51 (Neutral) by 1000 GMT. Investors’ will continue to track broad-based market sentiment, ahead of the U.S. unemployment benefit claims, factory orders and speech from Fed Quarles. Immediate resistance is located at 114.73 (Nov 6 High), a break above targets 115.00 (Mar 9 High). On the downside, support is seen at 113.81 (5-DMA), a break below could take it lower 113.25 (10-DMA).
GBP/USD: Sterling rebounded from an over 3-week low, boosted by a media report that Ireland is supporting Prime Minister Theresa May's plan for an all-UK customs union with the European Union. The major traded 0.4 percent up at 1.2981, having hit a low of 1.2921 earlier; it’s lowest since September 10. FxWirePro's Hourly Sterling Strength Index stood at 107.51 (Highly Bullish) 1000 GMT. Immediate resistance is located at 1.3012 (10-DMA), a break above could take it near 1.3090 (September 28 High). On the downside, support is seen at 1.2896 (September 10 Low), a break below targets 1.2855 (August 3 Low). Against the euro, the pound was trading 0.1 percent up at 88.55 pence, having hit a high of 88.52, it’s highest since September 20.
USD/CHF: The Swiss franc slightly edged up, drifting away from a 6-week low recorded on Wednesday, as emerging market currencies came under pressure from the strong dollar. The major trades 0.1 percent down at 0.9916, having touched a high of 0.9926 earlier, it’s highest since August 21. FxWirePro's Hourly Swiss Franc Strength Index stood at -61.34 (Bearish) by 1000 GMT. On the higher side, near-term resistance is around 0.9953 (August 13 High) and any break above will take the pair to next level till 0.9984 (August 6 High). The near-term support is around 0.9894 (August 9 Low) and any close below that level will drag it till 0.9842 (August 21 Low).
Equities Recap
European shares slumped, weighed down by losses in defensive stocks, while sterling bounced back as hard Brexit fears receded.
The pan-European STOXX 600 index plunged 0.8 percent at 380.86 points, while the FTSEurofirst 300 index eased 0.7 percent to 1,595.57 points.
Britain's FTSE 100 trades 1.1 percent lower at 7,428.65 points, while mid-cap FTSE 250 declined 0.7 percent to 20,144.92 points.
Germany's DAX fell 0.3 percent at 12,254.94 points; France's CAC 40 trades 0.9 percent lower at 5,437.87 points.
Commodities Recap
Crude oil price hold gains near 4-year highs, boosted by the imminent loss of Iranian supply through U.S. sanctions, however, the prospect of a rapid production increase from Saudi Arabia and Russia limited upside. International benchmark Brent crude was trading 0.2 percent up at $86.13 per barrel by 0958GMT, having hit a high of $86.71 on Wednesday, its highest since November 2014. U.S. West Texas Intermediate was trading 0.1 percent up at $76.26 a barrel, after rising as high as $76.88 on Wednesday, its highest since Nov 2014.
Gold prices surged despite upbeat U.S. economic data and hawkish comments from Federal Reserve policymakers raised prospects of the central bank sticking to its tighter monetary policy. Spot gold was 0.2 percent up at $1,199.16 an ounce by 1007 GMT, having hit a high of $1208.17 on Wednesday, its highest since September 21. U.S. gold futures dipped 0.1 percent to $1,201.9 an ounce.
Treasuries Recap
The U.S. Treasuries slumped during late European session ahead of the country’s initial jobless claims, scheduled to be released today by 12:30GMT respectively. The yield on the benchmark 10-year Treasuries jumped nearly 5-1/2 basis points to 3.215 percent, the super-long 30-year bond yields surged nearly 6 basis points to 3.375 percent and the yield on the short-term 2-year traded close to 3-1/2 basis points higher at 2.893 percent.
The Japanese 10-year government bond yield jumped to near 3-year high during late Asian session tracking a similar movement in the United States Treasuries, following a better-than-expected set of economic data released late yesterday. The yield on the benchmark 10-year JGB note, which moves inversely to its price, jumped 2 basis point to 0.160 percent, the yield on the long-term 30-year note surged 3-1/2 basis points to 0.953 percent and the yield on short-term 2-year traded 1/2 basis point higher at -0.108 percent.
The Australian government bonds plunged across the curve during Asian session tracking a heavy sell-off in the U.S. Treasuries, where 10-year UST yield hits a 7-year high of 3.200 percent. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, rose 5 basis points to 2.698 percent, the yield on the long-term 30-year bond traded 4-1/2 basis points higher at 3.188 percent and the yield on short-term 2-year surged 1-1/2 basis points to 2.001 percent.
