Market Roundup
- United Kingdom Oct 2018 reserve assets total increase to 164239.03 USD vs previous 161256.43 USD
- Eurozone Nov 2018 Sentix index decrease to 8.8 diff.idx (forecast 10.1 diff.idx) vs previous 11.4 diff.idx
- United Kingdom Oct 2018 Markit/CIPS service PMI decrease to 52.2 diff.idx (forecast 53.3 diff.idx) vs previous 53.9 diff.idx
Economic Data Ahead
- (0945 ET/1445 GMT) Financial firm Markit releases final U.S. composite PMI for the month of October. The index posted a final reading of 54.8 in the previous month.
- (0945 ET/1445 GMT) Markit Economics reports final U.S. services PMI for the month of October. The index posted a final reading of 54.7 in September.
- (1000 ET/1500 GMT) The Institute for Supply Management (ISM) is expected to report that U.S. non-manufacturing Purchasing Managers' index eased to a final reading of 59.5 in October from 61.6 in September.
- N/A The Federal Reserve releases its Loan Officer Survey.
Key Events
- N/A ECB’S Coeure and Nouy speak in Brussels
- (0900 ET/1300 GMT) ECB Vice President Guindos speaks at Brussels
- (0910 ET/1310 GMT) Bank of Canada Governor Poloz speaks in London
- (1000 ET/1400 GMT) Euro Zone finance ministers convene in Brussels
FX Beat
DXY: The dollar index rose ahead of U.S. midterm elections this week, while last week's robust U.S. economic data boosted investor sentiment. The greenback against a basket of currencies trades flat at 96.50, having touched a low of 95.99 on Friday, its lowest since October 24. FxWirePro's Hourly Dollar Strength Index stood at -57.84 (Bearish) by 1000 GMT.
EUR/USD: The euro declined after data show Eurozone sentix investors’ confidence index eased to 8.8 in November from a previous reading of 11.4 in October and below estimates of 10.1. The European currency traded 0.5 percent down at 1.1381, having touched a low of 1.1302 on Wednesday, its lowest since August 15. FxWirePro's Hourly Euro Strength Index stood at 38.22 (Neutral) by 1000 GMT. Immediate resistance is located at 1.1432 (October 25 High), a break above targets 1.1476 (October 24 High). On the downside, support is seen at 1.1372 (5-DMA), a break below could drag it till 1.1302 (October 31 Low).
USD/JPY: The dollar extended previous session gains, ahead of Tuesday’s U.S. congressional election with the Democratic Party facing a strong possibility of gaining control of the U.S. House of Representatives, with Republicans likely to keep the Senate. The major was trading 0.05 percent up at 113.24, having hit a high of 113.38 on Wednesday, its highest since October 9. FxWirePro's Hourly Yen Strength Index stood at -164.53 (Highly Bearish) by 1000 GMT. Investors’ will continue to track the broad-based market sentiment, ahead of the U.S. service PMI from both the Markit and ISM. Immediate resistance is located at 113.71 (September 28 High), a break above targets 114.10 (October 5 High). On the downside, support is seen at 112.35 (October 22 Low), a break below could take it lower 112.01 (October 17 Low).
GBP/USD: Sterling steadied above the 1.3000 handle after a Sunday Times report stated that Britain will reach a deal for leaving the European Union and that an all-UK customs arrangement would be part of it. The major traded 0.4 percent up at 1.3013, having hit a low of 1.2695 on Tuesday; it’s lowest since August 16. FxWirePro's Hourly Sterling Strength Index stood at 144.42 (Highly Bullish) 1000 GMT. Immediate resistance is located at 1.3103 (October 19 High), a break above could take it near 1.3192 (October 17 High). On the downside, support is seen at 1.2936 (October 23 Low), a break below targets 1.2867 (October 24 Low). Against the euro, the pound was trading 0.4 percent up at 87.45 pence, having hit a high of 87.41, it’s highest since October 11.
USD/CHF: The Swiss franc eased after rising to a 4-day peak in the previous session as the greenback surged after Friday's data showed that U.S. jobs growth rebounded sharply in October and wages recorded their largest annual gain in 9-1/2 years. The major trades 0.1 percent up at 1.0047, having touched a high of 1.0094 on Wednesday, it’s highest since May 2017. FxWirePro's Hourly Swiss Franc Strength Index stood at -121.26 (Highly Bearish) by 1000 GMT. On the higher side, near-term resistance is around 1.0100 and any break above will take the pair to next level till 1.0145. The near-term support is around 0.9954 (September 25 Low) and any close below that level will drag it till 0.9937 (September 23 Low).
Equities Recap
European shares gained, while sterling surged on hopes of a breakthrough in Brexit negotiations.
The pan-European STOXX 600 index gained 0.1 percent at 364.23 points, while the FTSEurofirst 300 index rallied 0.2 percent to 1,431.74 points.
Britain's FTSE 100 trades 0.1 percent up at 7,101.45 points, while mid-cap FTSE 250 fell 0.4 percent to 19,256.62 points.
Germany's DAX rose 0.2 percent at 11,539.89 points; France's CAC 40 trades 0.1 percent higher at 5,107.03 points.
Commodities Recap
Crude oil prices rebound after falling to multi-month lows ahead of U.S. sanctions against Iran's fuel exports. International benchmark Brent crude was trading 0.2 percent up at $72.73 per barrel by 1006 GMT, having hit a low of $74.20 on Friday, its lowest since August 21. U.S. West Texas Intermediate was trading 0.1 percent up at $62.91 a barrel, after falling as low as $62.56 earlier, its lowest since April 9.
Gold prices declined as the dollar steadied against a basket of currencies, while investors await the U.S. congressional elections on Tuesday. Spot gold trading 0.1 percent down at $1,231.81 per ounce by 1008 GMT, having touched a low of $1,211.87 on Wednesday, its lowest since Oct. 11. U.S. gold futures were up 0.1 percent at $1,234.6 per ounce.
Treasuries Recap
The U.S. Treasuries gained during late afternoon session ahead of the country’s ISM non-manufacturing PMI data for the month of October and the 3-year auction, both scheduled for today by 15:00GMT and 18:00GMT respectively. The yield on the benchmark 10-year Treasuries slipped 1 basis point to 3.205 percent, the super-long 30-year bond yields remained tad lower at 3.452 percent and the yield on the short-term 2-year traded 1 basis point lower at 2.903 percent.
The United Kingdom’s gilts suffered after investors have largely shrugged-off the lower-than-expected fall in the country’s services PMI for the month of October, released today. The yield on the benchmark 10-year gilts, jumped nearly 2 basis points to 1.512 percent, the super-long 30-year bond yields surged 1-1/2 basis points to 1.910 percent and the yield on the short-term 2-year traded nearly 2 basis points higher at 0.816 percent.
The Japanese government bonds traded mixed following limited market reaction from the Bank of Japan’s (BoJ) monetary policy meeting minutes for the month of November, released earlier today. The yield on the benchmark 10-year JGB note, which moves inversely to its price, jumped 13 basis points to 0.129 percent, the yield on the long-term 30-year note rose 1 basis point to 0.885 percent and the yield on short-term 2-year traded nearly 13 basis points lower at -0.128 percent.
The Australian government bonds slumped during Asian session on the first trading day of the week ahead of the Reserve Bank of Australia’s (RBA) monetary policy decision, scheduled to be unveiled on November 6 by 03:30GMT. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, jumped 3-1/2 basis points to 2.732 percent, the yield on the long-term 30-year bond surged 5 basis points to 3.254 percent and the yield on short-term 2-year traded nearly flat at 2.050 percent.
