Market Roundup
- EUR/USD -0.18%, USD/JPY 0.01%, GBP/USD 0.16%, EUR/GBP -0.36%
- DXY 0.11%, DAX -0.13%, FTSE -0.56%, Brent 0.21%, Gold 0.33%
- Turkey's lira tumbles after Moody's warning, FinMin comments
- Sterling holds near 1-year low vs euro before Brexit minister's speech
- Germany Sept Gfk Consumer Sentiment, 10.5, 10.6 forecast, 10.6 previous
- Trump, without evidence, blames China for hacking Clinton emails
- China faces increased economic risks in second half - state planner
- BOJ's Suzuki: need to watch policy impact on bond market
- Oil steady on lower Iran exports, rising U.S. supply
- Gold edges higher, but rate hike views weigh on market
Economic Data Ahead
- (0830 ET/1230 GMT) The U.S. Commerce Department is expected to report that preliminary gross domestic product increased at a 4.0 percent annual rate in the second quarter after surging at a 4.1 percent pace in the first quarter.
- (0830 ET/1230 GMT) The U.S. Commerce Department releases the preliminary personal consumption expenditures (PCE) price index for the second quarter. The index is expected to rise 1.8 percent, while core PCE is likely to increase 2.0 percent.
- (0830 ET/1230 GMT) The Statistics Canada is likely to report that current account deficit narrowed to C$15.20 billion in the second quarter, compared with a deficit of C$19.5 billion in the previous quarter.
- (1000 ET/1400 GMT) The National Association of Realtors is likely to report that U.S. pending home sales increased 0.3 percent in July after rising 0.9 percent in June.
- (1030 ET/1430 GMT) The Energy Information Administration (EIA) reports its Crude Oil Stocks for the week ending August 24.
Key Events Ahead
- No significant events scheduled
FX Beat
DXY: The dollar index rebounded from a 4-week low touched in the previous session, amid concerns among investors that the conflict over trade between the U.S. and China was not about to end soon. The greenback against a basket of currencies trades 0.2 percent up at 94.91, having touched a low of 94.43 on Tuesday, its lowest since July 31. FxWirePro's Hourly Dollar Strength Index stood at -117.71 (Highly Bearish) by 0500 GMT.
EUR/USD: The euro declined below the 1.1700 handle after data showed sentiment among German shoppers deteriorated unexpectedly for the second month in a row heading into September, raising doubt about the strength of a consumer-led momentum. The European currency traded 0.2 percent down at 1.1671, having touched a high of 1.1733 the day before, its highest since July 31. FxWirePro's Hourly Euro Strength Index stood at 47.14 (Neutral) by 1000 GMT. Immediate resistance is located at 1.1747 (July 31 High), a break above targets 1.1790 (July 9 High). On the downside, support is seen at 1.1625 (5-DMA), a break below could drag it till 1.1538 (21-DMA).
USD/JPY: The dollar consolidated within narrow ranges as optimism triggered by a U.S. trade deal with Mexico ebbed, while uncertainty about a similar agreement with Canada and a trade war between Washington and Beijing continued to dent investor sentiment. The major was trading flat at 111.18, having hit a high of 111.48 on Friday, its highest since August 6. FxWirePro's Hourly Yen Strength Index stood at -68.38 (Bearish) by 1000 GMT. Investors’ will continue to track broad-based market sentiment, ahead of the U.S. prelim gross domestic product, personal consumption expenditures and pending home sales. Immediate resistance is located at 111.52 (August 6 High), a break above targets 111.73 (August 2 High). On the downside, support is seen at 110.77 (10-DMA), a break below could take it lower 110.31 (August 17 Low).
GBP/USD: Sterling gained, reversing some of its previous session losses, as investors turned cautious ahead of a mid-recess speech by Brexit Minister Dominic Raab. Markets will closely scrutinize Dominic Raab's comments for further clues on securing a deal before leaving the European Union next year. The major traded 0.2 percent up at 1.2894, having hit a high of 1.2931 on Tuesday; it’s highest since August 22. FxWirePro's Hourly Sterling Strength Index stood at 2.73 (Neutral) 1000 GMT. Immediate resistance is located at 1.2936 (August 22 High), a break above could take it near 1.3006 (August 6 High). On the downside, support is seen at 1.2817 (10-DMA), a break below targets 1.2729 (August 20 Low). Against the euro, the pound was trading 0.4 percent down at 90.48 pence, having hit a low of 90.98 the day before, it’s lowest since September 2017.
USD/CHF: The Swiss franc edged down after rising to a 4-month peak in the previous session, as the greenback rebounded from recent lows. The major trades 0.1 percent up at 0.9771, having touched a low of 0.9745 on Tuesday, it’s lowest since April 20. FxWirePro's Hourly Swiss Franc Strength Index stood at 68.95 (Bullish) by 1000 GMT. On the higher side, near-term resistance is around 0.9802 (23.6% retracement of 0.9982 and0.9745) and any break above will take the pair to next level till 0.9837 (38.2% retracement). The near-term support is around 0.9705 and any close below that level will drag it till 0.9675.
Equities Recap
European shares tumbled as optimism triggered by a U.S. trade deal with Mexico ebbed, while the greenback steadied as Canada's chief negotiator continued talks to preserve a three-nation North American Free Trade Agreement.
The pan-European STOXX 600 index slumped 0.1 percent at 384.99 points, while the FTSEurofirst 300 index declined 0.1 percent to 1,506.85 points.
Britain's FTSE 100 trades 0.6 percent down at 7,569.32 points, while mid-cap FTSE 250 eased 0.5 percent to 20,747.65 points.
Germany's DAX fell 0.05 percent at 12,519.67 points; France's CAC 40 trades 0.05 percent lower at 5,484.03 points.
Commodities Recap
Crude oil prices rose, supported by news of a decline in Iranian crude supplies as U.S. sanctions deter buyers, however, a rise in U.S. inventories limited upside. International benchmark Brent crude was trading 0.3 percent up at $76.10 per barrel by 1034 GMT, having hit a high of $76.94 on Tuesday, its highest since July 11. U.S. West Texas Intermediate was trading 0.3 percent higher at $68.76 a barrel, after rising as high as $69.29 on Friday, its highest since August 8.
Gold prices surged after a sharp decline in the previous session, however, a firmer dollar amid expectations of higher U.S. interest rates and lingering Sino-U.S. trade tensions limited the safe-haven metal's upside. Spot gold was up 0.2 percent at $1,203.04 an ounce at 1037 GMT, having hit a high of $1214.19 on Tuesday, its highest since August 10. U.S. gold futures were down 0.3 percent at $1,210.60.
Treasuries Recap
The Eurozone bond yields were flat to lower, with 10-year yields in Italy, Spain and Portugal down 1-2 basis points; while core eurozone yields were flat. The German 5-year bond yield stood at -0.24 percent, while Italy's 10-year yield fell around one basis point to 3.17 percent, staying close to the 3-month highs hit on Tuesday.
The Japanese government bond prices were steady to slightly lower, with benchmark 10-year cash bonds untraded. The price of the 10-year JGB futures fell 0.04 point to 150.44. The 30-year JGB yield rose half a basis point to 0.840 percent, while the 20-year JGB yield was unchanged at 0.610 percent.
The Australian government bond futures were weaker, with the three-year bond contract off 1.5 ticks at 97.930. The 10-year contract slipped 2 ticks to 97.42. The New Zealand government bonds gained, sending yields 0.5 basis points lower towards the short end of the curve.
